TOKYO - Honda Motor Co. posted record revenues in the quarter ended Dec. 31 on strong exports to the United States and a favorable yen rate.
But it got burned on its currency hedging and booked a paper loss on its investment in XM Radio, which cut net profits.
Honda also raised its forecast for the fiscal year ending March 31, 2006. It now predicts record revenues, operating profits and net income for the full year.
It would be the sixth straight year of record revenues.
Operating profits rose 23.7 percent to an October-December quarter record ¥195.0 billion, or $1.66 billion at current exchange rates, compared with the year-earlier period. Net income fell 11.7 percent to $1.13 billion.
Revenues rose 15.8 percent to $20.94 billion, a record for any quarter. The jump came even as unit car and truck sales fell 0.1 percent to 816,000.
Much of the increase was caused by a beneficial yen rate. Honda said that if the yen had remained at its year-earlier level, revenues would have risen only 7.3 percent.
North American operating profits climbed 30.6 percent in the quarter to $904.2 million, as unit sales rose 7.7 percent to about 434,000. That excludes profits on vehicles exported from Japan, which are booked as Japanese profits.
European operating profits tumbled 48.5 percent to $24.2 million. Unit sales were flat at about 59,000.
One reason full-year profits will set a record is that Honda will transfer some of its pension liabilities to the government in the January-March quarter. It will book a $1.08 billion gain on the transaction.