FY19 2nd Quarter Financial Results

Transcription

1 2nd Quarter Financial Results CR-V (Japan) Honda Motor Co., Ltd. October 30,

2 Topics Outline of 2nd Quarter Financial Results and Financial s 2nd Quarter Financial Results and Financial s 2

3 Outline of Six Months Results Summary (Consolidated) Results Summary Operating profit was billion yen, a 21.7% increase compared with the same period last year, due mainly to increased motorcycle unit sales in Asia, cost reduction efforts *1 and the *1 reverse effect from the loss related to the litigation settlement in the previous fiscal year. Profit for the period attributable to owners of the parent increased to billion yen, a 19.3% increase compared with the same period a year ago. *1 Litigation settlement related to airbag inflator in 6-month results and Consolidated Unit Sales 6,691 7,148 1,807 1,827 Unit (thousand) 2,589 2,603 Sales Revenue / Operating Profit / Profit for the Period *2 7, , * Yen (billion) *2 Motorcycles Automobiles Power Products Sales Revenue Operating Profit Profit for the Period *2 All-time record for first half of fiscal year attributable to owners of the parent 3

4 Main Market (Automobiles) Japan Six Month Results 333 Unit (thousand) 346 vs. (%) Industry Demand 2, Unit Sales Unit (thousand) Retail (Source: Japan Automobile Dealers Association) Honda s retail sales were 104.0% compared with the same period last year, despite flat industry demand N-BOX series claimed best-selling model title in the first half of -Cumulative sales from Apr. to Sep. were 117 thousand units, % compared with the same period last year -Claimed best-selling model title among new cars for 13 months in a row New CR-V launched(aug.) -Cumulative number of orders within one month after the launch surpassed 5 thousand units -Launch of hybrid model planned in Nov % N-BOX FY 18 FY 19 CR-V 4

5 Main Market (Automobiles) U.S. Six Month Results Unit (thousand) % vs. (%) Industry Demand 8, Unit Sales Unit (thousand) Retail (Source: Autodata) Total sales of light trucks was 459 thousand units,107.6% compared with the same period last year -Sales of Pilot totaled 82 thousand units, or 139.1% compared with the same period last year -Underwent minor model change; launched in Jul. Civic becomes top-selling model in segment for 22 months in a row as of Sep. -Underwent minor model change; launched in Aug. Plan to resume full production in mid-nov. at Celaya plant in Mexico - Models exported to U.S. : HR-V, Fit Pilot FY 18 FY 19 Civic 5

6 Main Market (Automobiles) China Six Month Results Unit (thousand) vs. (%) Industry Demand * 13, Unit Sales Unit (thousand) Retail *Industry demand is wholesale basis (Source: China Association of Automobile Manufacturers) Civic rewrites monthly unit sales records for 3 months in a row from Jul. - Cumulative sales from Apr. to Sep. totaled 111 thousand units, 125.1% compared with the same period last year New Crider launched (Sep.) New Inspire unveiled (Oct.) % Civic FY 18 FY 19 Crider 6

7 Main Market (Motorcycles) Asia Six Month Results Unit (thousand) vs. (%) India 3, Vietnam 1, Thailand Indonesia 2, Total 7, Unit (thousand) 7,242 Wholesale 7,821 India Expansion of production capacity at motorcycle plant - Construction of new production line at the existing No.4 Plant - Total annual production capacity to reach 7 million units in 2020 Vietnam, Thailand, Indonesia Brand-new PCX HYBRID model launched - World s first * mass-production motorcycle model equipped with hybrid system * Source: Honda as of July % Activa FY 18 FY 19 PCX Hybrid 7

8 News Topics Joint development with Cruise and GM of shared autonomous vehicles (Oct.) - Work jointly with Cruise and GM to develop purpose-built autonomous vehicle for Cruise that can serve a wide variety of use cases, with possibility of promoting global operations of shared autonomous vehicle services in view. HondaJet becomes most delivered aircraft in class in first half of Began deliveries of HondaJet Elite (Aug.) -HondaJet and HondaJet Elite received type certification in India; first type certification received in Asia Selected to the Dow Jones Sustainability World Index(Sept.) HondaJet Elite -Selected to the Dow Jones Sustainability World Index, which benchmarks for socially responsible companies, for 2 nd consecutive year -Selected to the Dow Jones Sustainability Asia/Pacific Index, which evaluates companies in the Asia/Pacific region, for 4 th consecutive year 8

9 Six Months Financial Results (Consolidated) Financial Results Yen (billion) Six Month Results Change Sales revenue 7, , % Operating profit % Operating margin 5.6% 6.5% + 0.9pt Share of profit of investments accounted for using the equity method % Profit before income taxes % Profit for the period attributable to owners of the parent % Earnings per share attributable to owners of the parent (Yen) * * Please refer to the footnotes on the last page Market average rates (Yen) U.S. Dollar Yen up by 1 yen 9

10 Financial (Consolidated) Yen (billion) Change Results amount % Change from previous forecast Sales revenue 15, , % Operating profit % Operating margin 5.4% 5.0% - 0.4pt + 0.4pt Share of profit of investments accounted for using the equity method % - Profit before income taxes 1, , % Profit for the year attributable to owners of the parent 1, % Earnings per share attributable to owners of the parent (Yen) Market average rates (Yen) U.S. Dollar Yen up by 1 yen Yen down by 3 yen ( 1H 110 / 2H 110 ) 10

11 Dividend Dividend per Share (Yen) (Expectation) Increase / Decrease f rom Change from previous forecast 1 st Quarter End nd Quarter End rd Quarter End 25 ( 28 ) ( + 3 ) ( + 1 ) 4 th Quarter End 27 ( 28 ) ( + 1 ) ( + 1 ) Fiscal Year 100 ( 111 ) ( + 11 ) ( + 3 ) 11

12 Topics Outline of 2nd Quarter Financial Results and Financial s 2nd Quarter Financial Results and Financial s 12

13 2nd Quarter Unit Sales Honda Group Unit Sales 2Q Results (3 Months) Change Motorcycles 5,238 5, % Automobiles 1,292 1, % Power Products 1,258 1, % Consolidated Unit Sales (thousand) (thousand) 2Q Results (3 Months) Change Motorcycles 3,446 3, % Automobiles % Power Products 1,258 1, % 1,000 1,100 1,200 1,300 1,400 1,500 1,600 1,700 1,800 1,900 2,000 2,100 2,200 2,300 2,400 2,500 2,600 2,700 2,800 2,900 3,000 3,100 3,200 3,300 3,400 3,500 3,600 3,700 3,800 3,900 4,000 4,100 4,200 4,300 4,400 4,500 4,600 4,700 4,800 4,900 5,000 5,100 5,200 5,300 5,400 5,500 5,600 5,700 5,800 5,900 6, ,000 1,100 1,200 1,300 1,400 1,500 1,600 1,700 1,800 1,900 2,000 2,100 2,200 2,300 2,400 2,500 2,600 2,700 2,800 2,900 3,000 3,100 3,200 3,300 3,400 3,500 3,600 3,700 3,800 3,900 4,000 4,100 4,200 4,300 4,400 4, Honda Group Unit Sales 5,2385,315 1,700 1,600 1,500 1,400 1,300 1,200 1,100 1, Consolidated Unit Sales 3,446 3,533 1,300 1,200 1,100 1, Unit (thousand) 1,700 1,600 1,292 1,246 1,500 1,400 1,300 1,2581,262 1,200 1,100 1, Motorcycles Automobiles Power Products ,700 1,600 1,500 1,400 1,300 1,200 1,100 1, ,2581,262 Motorcycles Automobiles Power Products Honda Group Unit Sales Increase in motorcycle unit sales due mainly to sales growth in Indonesia, Vietnam and Brazil Decrease in automobile unit sales due mainly to sales decline in North America and China despite a growth in sales in Japan 13

14 2nd Quarter Financial Results (Consolidated) Financial Results Yen (billion) Change Sales revenue 3, , % Operating profit % Operating margin 4.1% 5.6% + 1.5pt Share of profit of investments accounted for using the equity method % Profit before income taxes % Profit for the period attributable to owners of the parent % Earnings per share attributable to owners of the parent (Yen) Market average rates (Yen) 2Q Results (3 Months) U.S. Dollar Yen down by 0 y en Financial Summary Sales revenue increased by 1.7% primarily due to an increase in sales revenue in financial services and motorcycle business operations. Operating profit increased by 40.2% due primarily to the positive impact from revenue and model mix and the multi-district class action litigation settlement in the same period last year. Operating Profit Yen (billion) 第 1 四半期第 2 四半期第 3 四半期第 4 四半期 Operating Margin 10% 8% 6% 4% 2% 0% 7.4% 7.3% 5.6% 4.1% (excl. litigation settlement 5.5%) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 7.2% 3.2% 第 1 四半期第 2 四半期第 3 四半期第 4 四半期 14

15 Motorcycles - Honda Group Unit Sales (Motorcycles, All-Terrain Vehicles, Side-by-Sides etc.) Unit (thousand) 7,000 6,000 PCX (Indonesia) <Asia> Increased sales in Indonesia and Vietnam <Other Regions> Increased sales in Brazil + 77 ( % ) 5,000 4,000 3,000 2,000 4,699 5,238 4,870 4,747 5,352 5,315 1, Q 2Q 3Q 4Q 1Q 2Q Japan North America Europe Asia 4,219 4,804 4,437 4,260 4,840 4,824 Other Regions Total 4,699 5,238 4,870 4,747 5,352 5,315 15

16 Automobiles - Honda Group Unit Sales 1,500 N-VAN (Japan) <North America> Negative impact of the Mexico plant flooding <Asia> Decreased sales of CR-V in China <Japan> Positive impact of the new N-VAN introduction and increased sales of N-BOX Unit (thousand) -46 ( % ) 1, ,267 1,292 1,344 1,296 1,305 1, Q 2Q 3Q 4Q 1Q 2Q Japan North America Europe Asia Other Regions Total 1,267 1,292 1,344 1,296 1,305 1,246 16

17 Power Products - Honda Group Unit Sales 2,500 GX270 (Engine) <Japan> Increased sales of OEM engines used in construction equipment <Europe> Increased sales of OEM engines used in construction equipment Unit (thousand) + 4 ( % ) 2,000 1,500 1,000 2, ,331 1,258 1,196 1,341 1, Q 2Q 3Q 4Q 1Q 2Q Japan North America , Europe Asia Other Regions Total 1,331 1,258 1,196 2,477 1,341 1,262 17

18 Honda Group Unit Sales < Six Months> Unit (thousand) Motorcycles Automobiles Power Products 9,937 10,667 2,559 2,551 2,589 2, ( % ) -8 ( % ) + 14 ( % ) Six Months Six Months Six Months Six Months Six Months Six Months Change Change Change Japan North America ,141 1, Europe Asia 9,023 9, ,093 1, Other Regions Total 9,937 10, ,559 2, ,589 2,

19 Change in Sales Revenue < 2nd Qtr> ( % ) Excluding currency translation effects ( % ) Yen (billion) 3, ( % ) ( % ) Motorcycle Business Automobile Business ( % ) (-0.6 % ) Financial Services Business Power Product & Other Businesses ,841.7 Currency Translation Effects Sales Revenue 2Q 2Q Motorcycles Automobiles 2, ,624.6 Financial Services Business Power Product & Other Businesses Total 3, ,841.7 Market average rates (Yen) U.S. Dollar Q 2Q 19

20 Change in Sales Revenue < Six Months> ( % ) Excluding currency translation effects ( % ) Yen (billion) 7, ( % ) Motorcycle Business ( % ) Automobile Business ( % ) ( % ) Financial Services Business Power Product & Other Businesses ,865.8 Currency Translation Effects Sales Revenue Six Months Six Months Motorcycles 1, ,094.2 Automobiles 5, ,421.9 Financial Services Business 1, ,185.9 Power Product & Other Businesses Total 7, ,865.8 Market average rates (Yen) U.S. Dollar Six Months Six Months 20

21 Change in Profit before Income Taxes < 2nd Qtr> Profit before Income Taxes ( % ) Yen (billion) Operating Profit ( % ) Revenue, model mix, etc. Excluding currency effects and litigation settlement Cost Reduction, etc SG&A R&D Currency Effects Litigation Settlement In Share of profit of investments accounted for using the equity method -2.7 Finance income and Finance costs Operating Profit Q <Decrease Factors> - Increase in warranty, etc. -JPY / USD - USD / Others (BRL, CAD, MXN) - JPY / Asian Currencies (INR, THB, VND, CNY, IDR) - USD / ARS -Others Currency Effects - Interest rate swap /currency swap -Others Operating Profit Q 21

22 Change in Profit before Income Taxes < Six Months> Operating Profit Six Months Revenue, model mix, etc. Profit before Income Taxes ( % ) Operating Profit ( % ) Excluding currency effects and litigation settlement Cost Reduction, etc SG&A <Increase Factors> - Cost reduction efforts, etc. <Decrease Factors> - Raw material price increase, etc R&D Currency Effects Litigation Settlement In -JPY / USD - USD / Others (BRL, CAD, MXN) - JPY / Asian Currencies (INR, THB, VND, CNY, IDR) - USD / ARS -Others Share of profit of investments accounted for using the equity method Currency Effects - Interest rate swap /currency swap -Others Finance income and Finance costs Yen (billion) Operating Profit Six Months 22

23 Motorcycle Business Sales Revenue/Operating Profit (Margin) Unit (thousand) Yen (billion) 1Q 2Q 3Q 4Q 1Q 2Q Honda Group Unit Sales 4,699 5,238 4,870 4,747 5,352 5,315 (Consolidated Unit Sales) (3,245) (3,446) (3,096) (3,167) (3,615) (3,533) Sales Revenue Yen (billion) Operating Profit Operating Margin 15.5% 13.4% 13.0% ( % ) (Currency effect ) 10.5% <Increase Factors> Positive impact from sales volume and model mix, etc. 16.6% 15.8% ( % ) 20% 15% 10% 5% 0% % % -15% 0 1Q 2Q 3Q 4Q 1Q 2Q -20% 23

24 Automobile Business Sales Revenue/Operating Profit (Margin) Unit (thousand) Yen (billion) 1Q 2Q 3Q 4Q 1Q 2Q Honda Group Unit Sales 1,267 1,292 1,344 1,296 1,305 1,246 (Consolidated Unit Sales) (900) (907) (932) (950) (952) (875) Sales Revenue 2, , , , , ,670.1 Yen (billion) Operating Profit Operating Margin 5.3% (excl. Litigation settlement:3.4%) 1.5% 5.8% ( % ) (Currency effect ) 0.9% 5.3% <Increase Factors> The impact of litigation settlement in 2.6% ( % ) 10% 0% -10% Q 2Q 3Q 4Q 1Q 2Q -20% 24

25 Power Product & Other Businesses Sales Revenue/Operating Profit (Margin) Unit (thousand) Yen (billion) 1Q 2Q 3Q 4Q 1Q 2Q Honda Group * Unit Sales 1,331 1,258 1,196 2,477 1,341 1,262 (Consolidated Unit Sales) (1,331) (1,258) (1,196) (2,477) (1,341) (1,262) Sales Revenue Yen (billion) Operating Profit Operating Margin ( % ) (Currency effect - 0.8) 10% % % 1.7% 1.5 <Increase Factors> Decreased expenses in other businesses operations etc % % % 5% 0% -5% -10 (For reference) Operating profit from aircraft and aircraft engines 1Q 2Q 3Q 4Q 1Q 2Q * Honda Group Unit Sales and Consolidated Unit Sales includes only power product units. -10% 25

26 Financial Services Business Total Assets/Sales Revenue/Operating Profit (Margin) Yen (billion) 1Q 2Q 3Q 4Q 1Q 2Q Total Assets of Finance Subsidiaries 9, , , , , ,153.8 Sales Revenue ( % ) Yen (billion) Operating Profit Operating Margin (Currency effect + 0.7) % 8.8% 9.6% 9.1% 9.6% 9.9% 15% 10% <Increase Factors> Increase in operating lease revenues, etc. ( % ) 5% 0% 60-5% % -15% 0 1Q 2Q 3Q 4Q 1Q 2Q -20% 26

27 Sales Revenue/Operating Profit (Margin) by Business Segment < Six Months> Motorcycle Automobile Power Product and Financial Services Business Business Other Businesses Business Unit (thousand) YTD YTD YTD YTD Yen (billion) Honda Group Unit Sales 9,937 10,667 2,559 2,551 2,589 2, (Consolidated Unit Sales) (6,691) (7,148) (1,807) (1,827) (2,589) (2,603) ( - ) ( - ) Sales Revenue 1, , , , , ,193.4 Operating Profit : Yen (billion) Operating 300Margin : (%) ( 14.5 % ) ( 16.2 % ) ( 3.4 % ) ( 4.0 % ) ( % ) ( % ) ( 9.0 % ) % % % ( 9.8 % ) YTD YTD YTD YTD 27

28 Sales Revenue/Operating Profit by Geographical Segment < 2nd Qtr> Yen (billion) Sales Revenue Japan North America Europe Asia Other Regions 2Q 2Q 2Q 2Q 2Q 1, , , , , , Operating Profit : Yen (billion) incl. litigation settlement 53.7(loss) % % % -50 2Q 2Q 2Q 2Q 2Q 28

29 Sales Revenue/Operating Profit by Geographical Segment < Six Months> Japan North America Europe Asia Other Regions YTD YTD YTD YTD YTD Yen (billion) Sales Revenue 2, , , , , , Operating Profit : Yen (billion) incl. litigation settlement 53.7(loss) % % % % % 30.6 YTD YTD YTD YTD YTD 29

30 Share of Profit of Investments Accounted for Using the Equity Method Yen (billion) ( % ) Q 2Q 3Q 4Q 1Q 2Q From Asia

31 Consolidated Capital Expenditures < Six Months> ( % ) Yen (billion) Excluding currency translation effects ( % ) Motorcycle Business Automobile Business Financial Services Business Power Product & Other Businesses Currency Translation Effects Capital Expenditures YTD YTD Motorcycles Automobiles Financial Services Business Power Product & Other Businesses Total Market average rates (Yen) U.S. Dollar Six Months * Capital expenditures in results aforementioned exclude investment in operating leases, finance leases and intangible assets. Six Months 31

32 : Honda Group Unit Sales Unit (thousand) Motorcycles Automobiles Power Products 20,850 20,850 19,554 6,262 6,345 6,345 5,199 5,285 5,285 ± 0 ( ± 0 % ) ± 0 ( ± 0 % ) ± 0 ( ± 0 % ) Results Previous Revised Results Previous Revised Results Previous Revised Previous Revised Change Previous Revised Change Previous Revised Change Japan North America ,940 1,940-3,055 3,055 - Europe ,040 1,035-5 Asia 18,855 18, ,220 2,220-1,535 1, Other Regions 1,235 1, Total 20,850 20,850-5,285 5,285-6,345 6,345-32

33 : Consolidated Unit Sales Unit (thousand) Motorcycles Automobiles Power Products 12,954 13,775 13,860 3,689 3,745 3,745 6,262 6,345 6, ( % ) ± 0 ( ± 0 % ) ± 0 ( ± 0 % ) Results Previous Revised Results Previous Revised Results Previous Revised Previous Revised Change Previous Revised Change Previous Revised Change Japan North America ,940 1,940-3,055 3,055 - Europe ,040 1,035-5 Asia 11,780 11, ,535 1, Other Regions 1,235 1, Total 13,775 13, ,745 3,745-6,345 6,345-33

34 Financial (Consolidated) Yen (billion) Change Results amount % Change from previous forecast Sales revenue 15, , % Operating profit % Operating margin 5.4% 5.0% - 0.4pt + 0.4pt Share of profit of investments accounted for using the equity method % - Profit before income taxes 1, , % Profit for the year attributable to owners of the parent 1, % Earnings per share attributable to owners of the parent (Yen) Market average rates (Yen) U.S. Dollar Yen up by 1 yen Yen down by 3 yen ( 1H 110 / 2H 110 ) 34

35 : Change in Profit before Income Taxes Profit before Income Taxes ( % ) Yen (billion) Operating Profit ( % ) 1,114.9 Operating Profit Cost Revenue, Reduction, model mix, etc. etc. SG&A R&D - JPY / USD - USD / Others (BRL, CAD, MXN) - JPY / Asian Currencies Currency Effects (INR, THB, VND, CNY, IDR) -Others - USD / ARS *1 Litigation Settlement in *2 *1 Restitution income In Real-term currency effects Share of profit of investments accounted for using the equity method Finance income and finance costs 1,010.0 Operating Profit Results *1 *2 Litigation settlement and restitution income related to airbag inflator in Weak Argentina peso is expected to cause inflationary impact of (-36.0). This amount is deducted from Currency Effects to calculate Real-term currency effects. (Price changes as a result of inflationary impact is included in Cost Reduction, etc. above.) 35

36 : Change in Operating Profit Operating Profit ( % ) Yen (billion) Real-term Currency Effects Litigation *1 Settlement Etc. in Raw material price increase Real-term profit change Impact of Mexico plant flooding (Including decrease of unit sales due to shutdown) Revenue, model mix, etc. Cost Reduction, etc. (excl. Raw material price increase) SG&A R&D Operating margin 5.4% Operating margin 4.9% Operating margin 5.2% Operating margin 5.0% Results *1 Litigation settlement and restitution income related to airbag inflator in 36

37 : Change in Profit before Income Taxes Profit before Income Taxes ( % ) Yen (billion) Operating Profit ( % ) Cost Reduction, Revenue, etc. model mix, etc SG&A R&D Currency Effects Share of profit of investments accounted for using the equity method Finance income and finance costs 1, JPY / USD - USD / Others (BRL, CAD, MXN) - JPY / Asian Currencies (INR, THB, VND, CNY, IDR) -Others - USD / ARS Operating Profit Operating Profit Previous Revised 37

38 : Capital Expenditures, Depreciation and R&D No changes have been made to the previous forecasts (on July 31, 2018) Yen (billion) Results Change Change from previous forecast Capital expenditures * Depreciation and amortization * Research and development expenditures * *1 Capital expenditures as well as Depreciation and amortization in results and forecast aforementioned exclude investment in operating leases, finance leases and intangible assets. *2 Research and development expenditures are research and development activity related costs incurred during the reporting period. In accordance with IFRS, a portion of research and development expenditures is recognized as an intangible asset and amortized over its estimated useful life. As such, this amount is not in conformity with "Research and development" on our Consolidated Statements of Income. 38

39 Caution with Respect to Forward-Looking Statements: This slide contains forward-looking statements about the performance of Honda, which are based on management s assumptions and beliefs taking into account information currently available to it. Therefore, please be advised that Honda s actual results could differ materially from those described in these forward-looking statements as a result of numerous factors, including general economic conditions in Honda s principal markets and fluctuation of foreign exchange rates, as well as other factors detailed from time to time. Accounting standards: Our consolidated financial statements are prepared in conformity with International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board (IASB) Notice on the Factors for Increases and Decreases in Income: With respect to the discussion above of the change in Operating profit, management has identified the factors set forth below and used what it believes to be a reasonable method to analyze the respective changes in such factors. Each of these factors is explained below. Management has analyzed changes in these factors at the levels of the Company and its material consolidated subsidiaries. (1) Currency effects consist of translation adjustments, which come from the translation of the currency of foreign subsidiaries financial statements into Japanese Yen, and foreign currency adjustments, which result from foreign-currency-denominated sales, which, at the levels of the Company and those consolidated subsidiaries which have been analyzed, primarily relate to the following currencies: U.S. dollar, Canada dollar, Euro, GBP, BRL and Japanese Yen. (2) With respect to Cost reduction, etc., management has analyzed cost reduction and effects of raw material cost fluctuations at the levels of the Company and its material foreign manufacturing subsidiaries in North America, Europe, Asia and other regions. (3) With respect to Revenue, model mix, etc., management has analyzed changes in sales volume and in the mix of product models sold in major markets which have resulted in increases/decreases in profit, as well as certain other reasons for increases/decreases in sales revenue and cost of sales. (4) With respect to Selling, General and Administrative expenses, management has analyzed reasons for an increase/decrease in selling, general and administrative expenses from the previous fiscal year net of currency translation effects. (5) With respect to Research and Development expenses, management has analyzed reasons for an increase/decrease in research and development expenses from the previous fiscal year net of currency translation effects. Unit sales: Motorcycle Business Honda Group Unit Sales is the total unit sales of completed products, including motorcycles, ATVs, and Side-by-Sides of Honda, its consolidated subsidiaries and its affiliates and joint ventures accounted for using the equity method. Consolidated Unit Sales is the total unit sales of completed products corresponding to consolidated sales revenue to external customers, which consists of unit sales of completed products of Honda and its consolidated subsidiaries. Automobile Business Honda Group Unit Sales is the total unit sales of completed products of Honda, its consolidated subsidiaries and its affiliates and joint ventures accounted for using the equity method. Consolidated Unit Sales is the total unit sales of completed products corresponding to consolidated sales revenue to external customers, which consists of unit sales of completed products of Honda and its consolidated subsidiaries. Certain sales of automobiles that are financed with residual value type auto loans by our Japanese finance subsidiaries and sold through our consolidated subsidiaries are accounted for as operating leases in conformity with IFRS and are not included in consolidated sales revenue to the external customers in our Automobile business. Accordingly, they are not included in Consolidated Unit Sales, but are included in Honda Group Unit Sales of our Automobile business. Power Product Business Honda Group Unit Sales is the total unit sales of completed power products of Honda, its consolidated subsidiaries and its affiliates and joint ventures accounted for using the equity method. Consolidated Unit Sales is the total unit sales of completed power products corresponding to consolidated sales revenue to external customers, which consists of unit sales of completed power products of Honda and its consolidated subsidiaries. In Power Product business, there is no discrepancy between Honda Group Unit Sales and Consolidated Unit Sales since no affiliate and joint venture accounted for using the equity method was involved in the sale of Honda power products. * Earnings per share attributable to owners of the parent is calculated based on weighted average number of shares outstanding as shown below: - 2 nd Quarter : 1,802,279,000 (approx), : 1,761,356,000 (approx) - Six Months : 1,802,280,000 (approx), : 1,767,773,000 (approx) - Fiscal year 1,793,088,000 (approx), forecast: 1,763,984,000 (approx) 39

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41 Appendix

42 Capital Expenditures, Depreciation and R&D < 2nd Qtr> 2Q YTD Yen (billion) Change Change Capital expenditures Depreciation and amortization Research and development expenditures

43 Cash Flows of Non-financial Services Businesses Six Months Net Change Yen (billion) 2, Cash flows from operating activities Cash flows from investing activities Cash flows from financing activities Effect of exchange rate changes 2,102.9 Net Cash 1,524.8 Cash & Cash equivalents at beginning of Free cash flow Net Cash 1,627.9 Cash & Cash equivalents at end of period Six Months Net Change , ,142.2 Cash flows from operating activities Cash flows from investing activities Cash flows from financing activities Effect of exchange rate changes Net Cash 1,678.1 Cash & Cash equivalents at beginning of Free cash flow Net Cash 1,683.7 Cash & Cash equivalents at end of period 43

44 Quarterly Consolidated Unit Sales 6 months Unit (thousand) 1Q 2Q 3Q 4Q 12 months 1Q 2Q Change % Japan % North America % Europe % Asia 2,765 3,012 2,663 2,680 11,120 3,103 3, % Other Regions , % Motorcycles 3,245 3,446 3,096 3,167 12,954 3,615 3, % Japan % North America , % Europe % Asia % Other Regions % Automobiles , % Japan % North America ,347 3, % Europe , % Asia , % Other Regions % Power Products 1,331 1,258 1,196 2,477 6,262 1,341 1, % 44