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By Chang-Ran Kim
TOKYO, Jan 30 (Reuters) - Honda Motor Co , Japan's second-biggest auto maker, reported on Friday a surprise 1.4 percent rise in quarterly operating profit and kept its full-year forecast unchanged despite a damaging slide in the dollar.
The maker of Accord cars had been expected to show a drop in operating profit hurt by a persistent sales slide at home and slower demand in its crucial U.S. market due to a dearth of new models and dwindling orders for high-volume passenger cars.
Instead, Honda said operating profit for the October-December quarter was 161.13 billion yen ($1.52 billion), much better than an average forecast by seven analysts of 145.9 billion yen.
Net profit jumped 31 percent to 151.05 billion yen, as expected, lifted by non-operating profits from financial activities and equities earnings from China. Sales inched up 0.2 percent to 1.99 trillion yen.
For the full business year to March 31, Honda stuck to its forecast for an operating profit of 623 billion yen, down 9.6 percent, but lifted its net profit forecast slightly, to 473 billion yen from 470 billion yen, calling for a 11 percent rise.
While many analysts are now using a dollar transaction rate of around 112 yen for the full year, Honda lowered its assumption by just one yen to 114 yen.
A weaker dollar hurts profits at Honda, which gets most of its income from its U.S. business.
Honda's results came a day after rivals Mazda Motor Corp and Nissan Motor Co reported solid quarterly revenues which likely kept them on track to post rosy full-year earnings.
Going forward, analysts said Honda would probably see its sales slide in the United States from last year's high levels for the time being, since few new products are expected before the second half of next business year.
In the third quarter, Honda's North American sales rose 4.9 percent to 407,000 cars, while sales at home dipped 12 percent to 177,000 units.
But its domestic sales and model mix will likely start to recover soon thanks to the launch of new cars such as the remodelled Odyssey minivan, analysts said.
Shares in Honda gained 6.5 percent during the three-month period, outperforming a 5.5 percent rise in the transport sector index and a 2.4 percent advance in the broad TOPIX index.
Before the news, its shares ended down 0.68 percent at 4,350 yen, while the TOPIX index of all first-section Tokyo shares lost 0.25 percent. ($1=105.88 Yen)