No.1-7628

 

 

 

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

FOR THE MONTH OF FEBRUARY 2021

COMMISSION FILE NUMBER: 1-07628

HONDA GIKEN KOGYO KABUSHIKI KAISHA

(Name of registrant)

HONDA MOTOR CO., LTD.

(Translation of registrant’s name into English)

1-1, Minami-Aoyama 2-chome, Minato-ku, Tokyo 107-8556, Japan

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F  ☒    Form 40-F  ☐    

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):  ☐

 

 

 

Contents

Exhibit 1:

On February 19, 2021, Honda Motor Co., Ltd. filed its consolidated financial statements for the fiscal third quarter ended December 31, 2020 with Financial Services Agency in Japan.

Exhibit 2:

Honda Motor Co., Ltd. (the “Company”) hereby announces that its Board of Directors today decided on the following personnel changes in its Directors and Operating Officers effective as of April 1, 2021, and made an internal decision regarding personnel changes in its Directors and Executive Officers to become effective after the transition of the Company to a company with three committees as of the date of the Ordinary General Meeting of Shareholders of the Company scheduled to be held in June 2021.

Exhibit 3:

Honda Motor Co., Ltd. (the “Company”) hereby announces that its Board of Directors today resolved that the Company will transition from a company with an audit and supervisory committee to a company with three committees. The particulars of the personnel changes in its officers accompanying this transition have been disclosed separately in the announcement dated today titled “Notice Concerning Changes in Representatives, Directors and Officers.”

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Date: February 19, 2021

HONDA MOTOR CO., LTD. AND SUBSIDIARIES

Condensed Consolidated Interim Financial Statements

December 31, 2020

HONDA MOTOR CO., LTD. AND SUBSIDIARIES

Consolidated Financial Results

Overview of Operating Performance

While the global economy which had slowed down due to the spread of coronavirus disease 2019 (COVID-19) has been on a recovery track, it has still affected Honda’s consolidated financial results for the nine months ended December 31, 2020.

Resulting from travel restriction measures by government, Honda’s production bases in Japan and overseas were also affected by suspended or reduced production mainly due to restrictions on employees’ commute to the workplaces and delays in the supply of parts within the supply chain. Some dealers in Japan and overseas were obliged to suspend business, shorten business hours, or reduce services such as inspections and repairs. As of the date of this report, Honda has been largely resuming its business activities and there is no significant impact on its businesses in major countries or regions.

Honda’s consolidated sales revenue for the nine months ended December 31, 2020 decreased by 16.8%, to ¥9,546.7 billion from the same period last year, due mainly to decreased sales revenue in all business operations. Operating profit decreased by 30.1%, to ¥447.0 billion from the same period last year, due mainly to a decrease in profit attributable to decreased sales revenue and model mix, which was partially offset by decreased selling, general and administrative expenses as well as continuing cost reduction. Profit before income taxes decreased by 16.2%, to ¥658.7 billion from the same period last year. Profit for the period attributable to owners of the parent decreased by 8.5%, to ¥444.1 billion from the same period last year.

Business Segments

Motorcycle Business

For the nine months ended December 31, 2019 and 2020

 

		Units (thousands)
		Honda Group Unit Sales*																Consolidated Unit Sales*
		Nine months ended Dec. 31, 2019				Nine months ended Dec. 31, 2020												Nine months ended Dec. 31, 2019				Nine months ended Dec. 31, 2020
										Change				%												Change				%
Motorcycle Business			15,038				10,591				(4,447	)			(29.6	)			9,732				7,263				(2,469	)			(25.4	)
Japan			154				155				1				0.6				154				155				1				0.6
North America			221				240				19				8.6				221				240				19				8.6
Europe			186				159				(27	)			(14.5	)			186				159				(27	)			(14.5	)
Asia			13,453				9,257				(4,196	)			(31.2	)			8,147				5,929				(2,218	)			(27.2	)
Other Regions			1,024				780				(244	)			(23.8	)			1,024				780				(244	)			(23.8	)

 

*

Honda Group Unit Sales is the total unit sales of completed motorcycle, ATV and side-by-side 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.

Sales revenue from external customers decreased by 20.7%, to ¥1,258.1 billion from the same period last year, due mainly to decreased consolidated unit sales. Operating profit decreased by 31.4%, to ¥152.3 billion from the same period last year, due mainly to a decrease in profit attributable to decreased sales volume and model mix, which was partially offset by decreased selling, general and administrative expenses as well as continuing cost reduction.

Automobile Business

For the nine months ended December 31, 2019 and 2020

 

		Units (thousands)
		Honda Group Unit Sales*																Consolidated Unit Sales*
		Nine months ended Dec. 31, 2019				Nine months ended Dec. 31, 2020												Nine months ended Dec. 31, 2019				Nine months ended Dec. 31, 2020
										Change				%												Change				%
Automobile Business			3,809				3,425				(384	)			(10.1	)			2,541				1,899				(642	)			(25.3	)
Japan			489				418				(71	)			(14.5	)			431				366				(65	)			(15.1	)
North America			1,402				1,098				(304	)			(21.7	)			1,402				1,098				(304	)			(21.7	)
Europe			103				77				(26	)			(25.2	)			103				77				(26	)			(25.2	)
Asia			1,655				1,741				86				5.2				445				267				(178	)			(40.0	)
Other Regions			160				91				(69	)			(43.1	)			160				91				(69	)			(43.1	)

 

*

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.

Sales revenue from external customers decreased by 19.3%, to ¥6,207.7 billion from the same period last year, due mainly to decreased consolidated unit sales. Operating profit decreased by 77.0%, to ¥52.6 billion from the same period last year, due mainly to a decrease in profit attributable to decreased sales volume and model mix, which was partially offset by continuing cost reduction as well as decreased selling, general and administrative expenses.

Financial Services Business

Sales revenue from external customers decreased by 5.5%, to ¥1,853.6 billion from the same period last year, due mainly to a decrease in revenues on disposition of lease vehicles. Operating profit increased by 27.4%, to ¥250.5 billion from the same period last year, due mainly to decreased selling, general and administrative expenses.

Life Creation and Other Businesses

For the nine months ended December 31, 2019 and 2020

 

		Units (thousands)
		Honda Group Unit Sales / Consolidated Unit Sales*
		Nine months ended Dec. 31, 2019				Nine months ended Dec. 31, 2020
										Change				%
Life Creation Business			3,630				3,855				225				6.2
Japan			218				233				15				6.9
North America			1,661				1,815				154				9.3
Europe			502				567				65				12.9
Asia			1,038				1,012				(26	)			(2.5	)
Other Regions			211				228				17				8.1

 

*

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 Life creation 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 were involved in the sale of Honda power products.

Sales revenue from external customers decreased by 3.0%, to ¥227.1 billion from the same period last year, due mainly to decreased sales revenue in Other businesses. Operating loss was ¥8.5 billion, an improvement of ¥0.1 billion from the same period last year, due mainly to decreased selling, general and administrative expenses as well as continuing cost reduction, which was partially offset by a decrease in profit attributable to decreased sales volume and model mix. In addition, operating loss of aircraft and aircraft engines included in the Life creation and other businesses was ¥24.5 billion, an improvement of ¥3.8 billion from the same period last year.

Cash Flows

Consolidated cash and cash equivalents on December 31, 2020 increased by ¥200.9 billion from March 31, 2020, to ¥2,873.2 billion. The reasons for the increases or decreases for each cash flow activity, when compared with the same period last year, are as follows:

Net cash provided by operating activities amounted to ¥826.1 billion of cash inflows. Cash inflows from operating activities increased by ¥220.7 billion from the same period last year, due mainly to decreased payments for parts and raw materials, which was partially offset by decreased cash received from customers.

Net cash used in investing activities amounted to ¥663.6 billion of cash outflows. Cash outflows from investing activities increased by ¥227.6 billion from the same period last year, due mainly to increased payments for acquisitions of investments accounted for using the equity method as well as decreased proceeds from sales and redemptions of other financial assets.

Net cash provided by financing activities amounted to ¥81.5 billion of cash inflows. Cash inflows from financing activities increased by ¥281.6 billion from the same period last year, due mainly to increased proceeds from financing liabilities.

Research and Development

The changes in research and development activities by Honda and its subsidiaries for the nine months ended December 31, 2020 are as follows:

Honda and the automobile product development division excluding the design function etc. of Honda R&D Co., Ltd. were integrated and Honda merged with Honda Engineering Co., Ltd., with an aim to transition from the current structure where sales, manufacturing, development and procurement divisions operate independently to a new structure where each process of planning and concept making, development, launch and mass-production of a new product are coordinated closely. In addition, the Innovative Research Excellence – Power Unit & Energy center and the Design center were newly established in Honda R&D Co., Ltd. In the area of power unit technologies, which is a source of Honda’s competitive strength, the Innovative Research Excellence – Power Unit & Energy center will fully demonstrate the strengths of Honda as a company that has a broad range of technologies and strive to increase the value of its product for the future with integration of research and development functions for power unit and energy technologies for motorcycles, automobiles, power products and business jets. The Design center will strengthen the consistent Honda brand across products with integration of design functions for products of motorcycles, automobiles and life creation as well.

Employees

The number of employees of Honda as of December 31, 2020 increased by 10,683, to 36,062 from March 31, 2020, due mainly to the integration of Honda and the automobile product development division excluding the design function etc. of Honda R&D Co., Ltd. and the merger with Honda Engineering Co., Ltd. by Honda in Automobile business. There was no significant changes in the total number of employees of Honda and its subsidiaries for the nine months ended December 31, 2020.

Plans for Capital Expenditures for Fiscal Year 2021

There is no decision relating to plans for significant capital expenditures for the nine months ended December 31, 2020.

HONDA MOTOR CO., LTD. AND SUBSIDIARIES

Condensed Consolidated Statements of Financial Position

March 31, 2020 and December 31, 2020

 

						Yen (millions)
Assets		Note				March 31, 2020				December 31, 2020
						unaudited				unaudited
Current assets:
Cash and cash equivalents						¥	2,672,353			¥	2,873,289
Trade receivables							633,909				639,755
Receivables from financial services							1,878,358				1,684,526
Other financial assets							190,053				352,123
Inventories							1,560,568				1,448,639
Other current assets							365,769				361,229
Total current assets							7,301,010				7,359,561
Non-current assets:
Investments accounted for using the equity method							655,475				804,181
Receivables from financial services							3,282,807				3,340,466
Other financial assets							441,724				626,746
Equipment on operating leases			6				4,626,063				4,603,672
Property, plant and equipment			7				3,051,704				2,921,098
Intangible assets							760,434				807,739
Deferred tax assets							132,553				86,318
Other non-current assets							209,695				230,422
Total non-current assets							13,160,455				13,420,642
Total assets						¥	20,461,465			¥	20,780,203
						Yen (millions)
Liabilities and Equity		Note				March 31, 2020				December 31, 2020
						unaudited				unaudited
Current liabilities:
Trade payables						¥	958,469			¥	959,136
Financing liabilities							3,248,457				3,323,459
Accrued expenses							449,716				369,960
Other financial liabilities							209,065				169,775
Income taxes payable							43,759				45,945
Provisions			8				287,175				311,461
Other current liabilities							593,447				545,940
Total current liabilities							5,790,088				5,725,676
Non-current liabilities:
Financing liabilities							4,221,229				4,305,653
Other financial liabilities							303,570				286,330
Retirement benefit liabilities							578,909				570,174
Provisions			8				238,439				264,109
Deferred tax liabilities							698,868				712,612
Other non-current liabilities							344,339				339,597
Total non-current liabilities							6,385,354				6,478,475
Total liabilities							12,175,442				12,204,151
Equity:
Common stock							86,067				86,067
Capital surplus							171,823				172,026
Treasury stock							(273,940	)			(273,820	)
Retained earnings							8,142,948				8,487,222
Other components of equity							(114,639	)			(164,892	)
Equity attributable to owners of the parent							8,012,259				8,306,603
Non-controlling interests							273,764				269,449
Total equity							8,286,023				8,576,052
Total liabilities and equity						¥	20,461,465			¥	20,780,203

See accompanying notes to condensed consolidated interim financial statements.

HONDA MOTOR CO., LTD. AND SUBSIDIARIES

Condensed Consolidated Statements of Income

For the nine months ended December 31, 2019 and 2020

 

						Yen (millions)
		Note				December 31, 2019				December 31, 2020
						unaudited				unaudited
Sales revenue			9			¥	11,472,949			¥	9,546,713
Operating costs and expenses:
Cost of sales							(9,090,126	)			(7,594,521	)
Selling, general and administrative							(1,163,591	)			(1,004,211	)
Research and development							(579,978	)			(500,981	)
Total operating costs and expenses							(10,833,695	)			(9,099,713	)
Operating profit							639,254				447,000
Share of profit of investments accounted for using the equity method			5				149,731				204,570
Finance income and finance costs:
Interest income							38,565				13,572
Interest expense							(15,125	)			(8,563	)
Other, net							(26,257	)			2,128
Total finance income and finance costs							(2,817	)			7,137
Profit before income taxes							786,168				658,707
Income tax expense							(254,713	)			(186,809	)
Profit for the period						¥	531,455			¥	471,898
Profit for the period attributable to:
Owners of the parent							485,288				444,102
Non-controlling interests							46,167				27,796
						Yen
						December 31, 2019				December 31, 2020
Earnings per share attributable to owners of the parent
Basic and diluted			12			¥	276.13			¥	257.21

See accompanying notes to condensed consolidated interim financial statements.

HONDA MOTOR CO., LTD. AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Income

For the nine months ended December 31, 2019 and 2020

 

						Yen (millions)
		Note				December 31, 2019				December 31, 2020
						unaudited				unaudited
Profit for the period						¥	531,455			¥	471,898
Other comprehensive income, net of tax:
Items that will not be reclassified to profit or loss
Remeasurements of defined benefit plans							—				—
Net changes in revaluation of financial assets measured at fair value through other comprehensive income							3,337				64,000
Share of other comprehensive income of investments accounted for using the equity method							704				613
Items that may be reclassified subsequently to profit or loss
Net changes in revaluation of financial assets measured at fair value through other comprehensive income							99				127
Exchange differences on translating foreign operations							(90,608	)			(114,008	)
Share of other comprehensive income of investments accounted for using the equity method							(23,331	)			5,772
Total other comprehensive income, net of tax							(109,799	)			(43,496	)
Comprehensive income for the period						¥	421,656			¥	428,402
Comprehensive income for the period attributable to:
Owners of the parent							378,667				394,202
Non-controlling interests							42,989				34,200

See accompanying notes to condensed consolidated interim financial statements.

HONDA MOTOR CO., LTD. AND SUBSIDIARIES

Condensed Consolidated Statements of Income

For the three months ended December 31, 2019 and 2020

 

						Yen (millions)
		Note				December 31, 2019				December 31, 2020
						unaudited				unaudited
Sales revenue			9			¥	3,747,593			¥	3,771,569
Operating costs and expenses:
Cost of sales							(2,966,552	)			(2,940,964	)
Selling, general and administrative							(379,648	)			(381,019	)
Research and development							(234,744	)			(171,851	)
Total operating costs and expenses							(3,580,944	)			(3,493,834	)
Operating profit							166,649				277,735
Share of profit of investments accounted for using the equity method							41,552				102,274
Finance income and finance costs:
Interest income							12,305				4,695
Interest expense							(7,530	)			(2,014	)
Other, net							(6,243	)			3,733
Total finance income and finance costs							(1,468	)			6,414
Profit before income taxes							206,733				386,423
Income tax expense							(75,043	)			(87,094	)
Profit for the period						¥	131,690			¥	299,329
Profit for the period attributable to:
Owners of the parent							116,432				284,051
Non-controlling interests							15,258				15,278
						Yen
						December 31, 2019				December 31, 2020
Earnings per share attributable to owners of the parent
Basic and diluted			12			¥	66.37			¥	164.51

See accompanying notes to condensed consolidated interim financial statements.

HONDA MOTOR CO., LTD. AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Income

For the three months ended December 31, 2019 and 2020

 

						Yen (millions)
		Note				December 31, 2019				December 31, 2020
						unaudited				unaudited
Profit for the period						¥	131,690			¥	299,329
Other comprehensive income, net of tax:
Items that will not be reclassified to profit or loss
Remeasurements of defined benefit plans							—				—
Net changes in revaluation of financial assets measured at fair value through other comprehensive income							8,030				45,754
Share of other comprehensive income of investments accounted for using the equity method							1,308				1,040
Items that may be reclassified subsequently to profit or loss
Net changes in revaluation of financial assets measured at fair value through other comprehensive income							(65	)			13
Exchange differences on translating foreign operations							77,102				(36,418	)
Share of other comprehensive income of investments accounted for using the equity method							8,240				5,297
Total other comprehensive income, net of tax							94,615				15,686
Comprehensive income for the period						¥	226,305			¥	315,015
Comprehensive income for the period attributable to:
Owners of the parent							205,575				296,866
Non-controlling interests							20,730				18,149

See accompanying notes to condensed consolidated interim financial statements.

HONDA MOTOR CO., LTD. AND SUBSIDIARIES

Condensed Consolidated Statements of Changes in Equity

For the nine months ended December 31, 2019 and 2020

 

						Yen (millions)
						Equity attributable to owners of the parent
		Note				Common stock				Capital surplus				Treasury stock				Retained earnings				Other components of equity				Total				Non-controlling interests				Total equity
Balance as of April 1, 2019 (unaudited)						¥	86,067			¥	171,460			¥	(177,827	)		¥	7,973,637			¥	214,383			¥	8,267,720			¥	298,070			¥	8,565,790
Comprehensive income for the period
Profit for the period																			485,288								485,288				46,167				531,455
Other comprehensive income, net of tax																							(106,621	)			(106,621	)			(3,178	)			(109,799	)
Total comprehensive income for the period																			485,288				(106,621	)			378,667				42,989				421,656
Reclassification to retained earnings																			(40	)			40				—								—
Transactions with owners and other
Dividends paid			13																(147,863	)							(147,863	)			(54,987	)			(202,850	)
Purchases of treasury stock															(39,475	)											(39,475	)							(39,475	)
Disposal of treasury stock															79												79								79
Share-based payment transactions											330																330								330
Equity transactions and others																															(3,049	)			(3,049	)
Total transactions with owners and other											330				(39,396	)			(147,863	)							(186,929	)			(58,036	)			(244,965	)
Other changes																			1,775								1,775								1,775
Balance as of December 31, 2019 (unaudited)						¥	86,067			¥	171,790			¥	(217,223	)		¥	8,312,797			¥	107,802			¥	8,461,233			¥	283,023			¥	8,744,256
						Yen (millions)
						Equity attributable to owners of the parent
		Note				Common stock				Capital surplus				Treasury stock				Retained earnings				Other components of equity				Total				Non-controlling interests				Total equity
Balance as of April 1, 2020 (unaudited)						¥	86,067			¥	171,823			¥	(273,940	)		¥	8,142,948			¥	(114,639	)		¥	8,012,259			¥	273,764			¥	8,286,023
Comprehensive income for the period
Profit for the period																			444,102								444,102				27,796				471,898
Other comprehensive income, net of tax																							(49,900	)			(49,900	)			6,404				(43,496	)
Total comprehensive income for the period																			444,102				(49,900	)			394,202				34,200				428,402
Reclassification to retained earnings																			353				(353	)			—								—
Transactions with owners and other
Dividends paid			13																(100,181	)							(100,181	)			(40,766	)			(140,947	)
Purchases of treasury stock															(4	)											(4	)							(4	)
Disposal of treasury stock															124												124								124
Share-based payment transactions											203																203								203
Equity transactions and others																															2,251				2,251
Total transactions with owners and other											203				120				(100,181	)							(99,858	)			(38,515	)			(138,373	)
Balance as of December 31, 2020 (unaudited)						¥	86,067			¥	172,026			¥	(273,820	)		¥	8,487,222			¥	(164,892	)		¥	8,306,603			¥	269,449			¥	8,576,052

See accompanying notes to condensed consolidated interim financial statements.

HONDA MOTOR CO., LTD. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

For the nine months ended December 31, 2019 and 2020

 

						Yen (millions)
		Note				December 31, 2019				December 31, 2020
						unaudited				unaudited
Cash flows from operating activities:
Profit before income taxes						¥	786,168			¥	658,707
Depreciation, amortization and impairment losses excluding equipment on operating leases							529,727				444,545
Share of profit of investments accounted for using the equity method							(149,731	)			(204,570	)
Finance income and finance costs, net							(36,878	)			52,741
Interest income and interest costs from financial services, net							(98,250	)			(99,425	)
Changes in assets and liabilities
Trade receivables							144,006				6,927
Inventories							(14,088	)			88,067
Trade payables							(208,556	)			78,928
Accrued expenses							(56,143	)			(72,394	)
Provisions and retirement benefit liabilities							(34,155	)			86,077
Receivables from financial services							30,472				(11,553	)
Equipment on operating leases							(248,773	)			(118,989	)
Other assets and liabilities							(104,211	)			(151,391	)
Other, net							3,782				(608	)
Dividends received							104,657				119,642
Interest received							218,353				177,097
Interest paid							(113,631	)			(83,502	)
Income taxes paid, net of refunds							(147,350	)			(144,107	)
Net cash provided by operating activities							605,399				826,192
Cash flows from investing activities:
Payments for additions to property, plant and equipment							(250,995	)			(227,151	)
Payments for additions to and internally developed intangible assets							(159,851	)			(165,830	)
Proceeds from sales of property, plant and equipment and intangible assets							10,307				4,680
Payments for acquisitions of subsidiaries, net of cash and cash equivalents acquired							(3,047	)			2,230
Payments for acquisitions of investments accounted for using the equity method							(4,802	)			(110,747	)
Proceeds from sales of investments accounted for using the equity method							—				10,376
Payments for acquisitions of other financial assets							(240,295	)			(311,873	)
Proceeds from sales and redemptions of other financial assets							214,102				134,639
Other, net							(1,404	)			—
Net cash used in investing activities							(435,985	)			(663,676	)
Cash flows from financing activities:
Proceeds from short-term financing liabilities							6,226,745				6,992,681
Repayments of short-term financing liabilities							(6,348,745	)			(6,781,179	)
Proceeds from long-term financing liabilities							1,398,797				1,356,619
Repayments of long-term financing liabilities							(1,182,699	)			(1,304,276	)
Dividends paid to owners of the parent							(147,863	)			(100,181	)
Dividends paid to non-controlling interests							(47,043	)			(34,134	)
Purchases and sales of treasury stock, net							(39,396	)			120
Repayments of lease liabilities							(55,689	)			(47,584	)
Other, net							(4,237	)			(555	)
Net cash provided by (used in) financing activities							(200,130	)			81,511
Effect of exchange rate changes on cash and cash equivalents							(21,581	)			(43,091	)
Net change in cash and cash equivalents							(52,297	)			200,936
Cash and cash equivalents at beginning of year							2,494,121				2,672,353
Cash and cash equivalents at end of period						¥	2,441,824			¥	2,873,289

See accompanying notes to condensed consolidated interim financial statements.

 

1

 

HONDA MOTOR CO., LTD. AND SUBSIDIARIES

Notes to Condensed Consolidated Interim Financial Statements

(1) Reporting Entity

Honda Motor Co., Ltd. (the “Company”) is a public company domiciled in Japan. The Company and its subsidiaries (collectively “Honda”) develop, manufacture and distribute motorcycles, automobiles, power products and others throughout the world, and also provide financial services to customers and dealers for the sale of those products. Principal manufacturing facilities are located in Japan, the United States of America, Canada, Mexico, the United Kingdom, Turkey, Italy, France, China, India, Indonesia, Malaysia, Thailand, Vietnam, Argentina and Brazil.

(2) Basis of Preparation

 (a) Compliance with Interim Financial Reporting Standards

The condensed consolidated interim financial statements of the Company have been prepared in accordance with IAS 34 “Interim Financial Reporting”. The condensed consolidated interim financial statements should be read in conjunction with the Company’s consolidated financial statements for the fiscal year ended March 31, 2020, since the condensed consolidated interim financial statements do not include all the information required in the annual consolidated financial statements, which have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board.

 (b) Functional Currency and Presentation Currency

The condensed consolidated interim financial statements are presented in Japanese yen, which is the functional currency of the Company. All financial information presented in Japanese yen has been rounded to the nearest million Japanese yen, except when otherwise indicated.

 (c) Use of Estimates and Judgments

The preparation of condensed consolidated interim financial statements requires management to make judgments, estimates and assumptions that affect the application of accounting policies, the reported amount of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities. Actual results could differ from these estimates. These estimates and underlying assumptions are reviewed on a continuous basis. Changes in these accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.

The condensed consolidated interim financial statements are prepared based on the same judgments and estimations as those applied and described in the Company’s consolidated financial statements for the fiscal year ended March 31, 2020.

(3) Summary of Significant Accounting Policies

The condensed consolidated interim financial statements are prepared based on the same accounting policies as those applied and described in the Company’s consolidated financial statements for the fiscal year ended March 31, 2020.

 

2

 

HONDA MOTOR CO., LTD. AND SUBSIDIARIES

Notes to Condensed Consolidated Interim Financial Statements

 

(4) Segment Information

Honda has four reportable segments: Motorcycle business, Automobile business, Financial services business and Life creation and other businesses, which are based on Honda’s organizational structure and characteristics of products and services. Operating segments are defined as the components of Honda for which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The accounting policies used for these reportable segments are consistent with the accounting policies used in the Company’s condensed consolidated interim financial statements.

Principal products and services, and functions of each segment are as follows:

 

Segment		Principal products and services		Functions
Motorcycle Business		Motorcycles, all-terrain vehicles (ATVs), side-by-sides (SxS) and relevant parts		Research and development Manufacturing Sales and related services
Automobile Business		Automobiles and relevant parts		Research and development Manufacturing Sales and related services
Financial Services Business		Financial services		Retail loan and lease related to Honda products Others
Life Creation and Other Businesses		Power products and relevant parts, and others		Research and development Manufacturing Sales and related services Others

   (a) Segment Information

Segment information as of and for the nine months ended December 31, 2019 and 2020 is as follows:

As of and for the nine months ended December 31, 2019

 

		Yen (millions)
		Motorcycle Business				Automobile Business				Financial Services Business				Life Creation and Other Businesses				Segment Total				Reconciling Items				Consolidated
Sales revenue:
External customers		¥	1,585,770			¥	7,691,119			¥	1,961,952			¥	234,108			¥	11,472,949			¥	—			¥	11,472,949
Intersegment			—				164,786				10,626				19,317				194,729				(194,729	)			—
Total			1,585,770				7,855,905				1,972,578				253,425				11,667,678				(194,729	)			11,472,949
Segment profit (loss)		¥	222,182			¥	229,000			¥	196,761			¥	(8,689	)		¥	639,254			¥	—			¥	639,254
Segment assets		¥	1,519,250			¥	7,837,663			¥	10,373,083			¥	362,483			¥	20,092,479			¥	396,227			¥	20,488,706
Depreciation and amortization			50,147				417,950				615,663				10,777				1,094,537				—				1,094,537
Capital expenditures			52,849				328,282				1,730,700				10,574				2,122,405				—				2,122,405

 

3

 

HONDA MOTOR CO., LTD. AND SUBSIDIARIES

Notes to Condensed Consolidated Interim Financial Statements

 

As of and for the nine months ended December 31, 2020

 

		Yen (millions)
		Motorcycle Business				Automobile Business				Financial Services Business				Life Creation and Other Businesses				Segment Total				Reconciling Items				Consolidated
Sales revenue:
External customers		¥	1,258,173			¥	6,207,728			¥	1,853,641			¥	227,171			¥	9,546,713			¥	—			¥	9,546,713
Intersegment			—				153,209				9,520				14,270				176,999				(176,999	)			—
Total			1,258,173				6,360,937				1,863,161				241,441				9,723,712				(176,999	)			9,546,713
Segment profit (loss)		¥	152,379			¥	52,624			¥	250,581			¥	(8,584	)		¥	447,000			¥	—			¥	447,000
Segment assets		¥	1,382,083			¥	8,061,407			¥	10,280,529			¥	360,515			¥	20,084,534			¥	695,669			¥	20,780,203
Depreciation and amortization			50,324				378,524				617,238				11,484				1,057,570				—				1,057,570
Capital expenditures			28,358				348,446				1,485,375				7,004				1,869,183				—				1,869,183

Segment information for the three months ended December 31, 2019 and 2020 is as follows:

For the three months ended December 31, 2019

 

		Yen (millions)
		Motorcycle Business				Automobile Business				Financial Services Business				Life Creation and Other Businesses				Segment Total				Reconciling Items				Consolidated
Sales revenue:
External customers		¥	530,227			¥	2,523,149			¥	616,318			¥	77,899			¥	3,747,593			¥	—			¥	3,747,593
Intersegment			—				51,736				3,470				8,471				63,677				(63,677	)			—
Total			530,227				2,574,885				619,788				86,370				3,811,270				(63,677	)			3,747,593
Segment profit (loss)		¥	74,527			¥	33,707			¥	64,599			¥	(6,184	)		¥	166,649			¥	—			¥	166,649

For the three months ended December 31, 2020

 

		Yen (millions)
		Motorcycle Business				Automobile Business				Financial Services Business				Life Creation and Other Businesses				Segment Total				Reconciling Items				Consolidated
Sales revenue:
External customers		¥	490,857			¥	2,585,190			¥	614,549			¥	80,973			¥	3,771,569			¥	—			¥	3,771,569
Intersegment			—				52,925				3,097				5,434				61,456				(61,456	)			—
Total			490,857				2,638,115				617,646				86,407				3,833,025				(61,456	)			3,771,569
Segment profit (loss)		¥	72,715			¥	123,127			¥	85,715			¥	(3,822	)		¥	277,735			¥	—			¥	277,735

 

Explanatory notes:

 

1.

Segment profit (loss) of each segment is measured in a consistent manner with consolidated operating profit, which is profit before income taxes before share of profit of investments accounted for using the equity method and finance income and finance costs. Expenses not directly associated with specific segments are allocated based on the most reasonable measures applicable.

 

2.

Segment assets of each segment are defined as total assets including investments accounted for using the equity method, derivatives, and deferred tax assets. Segment assets are based on those directly associated with each segment and those not directly associated with specific segments are allocated based on the most reasonable measures applicable except for the corporate assets described below.

 

3.	Intersegment sales revenues are generally made at values that approximate arm’s-length prices.

 

4.

Reconciling items include elimination of intersegment transactions and balances as well as unallocated corporate assets. Unallocated corporate assets, included in reconciling items as of December 31, 2019 and 2020 amounted to ¥650,927 million and ¥931,069 million, respectively, which consist primarily of the Company’s cash and cash equivalents and financial assets measured at fair value through other comprehensive income.