fy04 4 fy04 4

1FY04 4th Quarter / 12-Month Results

FY04 4FY04 4thth Quarter / 12Quarter / 12--Month Financial ResultsMonth Financial Results

Acura TLAcura TL


Agenda

· Outline of FY04 Financial Results & FY05 Financial Forecasts

Presenter: Executive Vice President - Koichi Amemiya

· Details of FY04 Financial Results & FY05 Financial Forecasts(1) 4th Quarter Results(2) 12-Month Results(3) Consolidated Balance Sheets & Cash Flows(4) FY05 Financial Forecasts

Presenter: Senior Managing Director - Satoshi Aoki


· Outline of FY04 Financial Results & FY05 Financial Forecasts

(1) Outline of FY04 4th Quarter Consolidated Financial Results

(2) Outline of FY04 12-Month Financial Results· Consolidated· Unconsolidated

(3) FY05 Financial Forecasts· Consolidated· Unconsolidated

(4) Acquisition of Common Stock


Outline of FY04 4th Quarter Results

- 35.1%

- 36.5%

- 40.0%

- 43.3%

+ 0.8%

Change

120.8678.47EPS (yen)

116.774.1Net income

177.3106.4Income before income taxes

241.6137.1Operating income

2,128.62,144.9*Net sales & other operation revenue

FY03 4QFY04 4Q(Billions of Yen)

134107

weaker by 6 yen 128Euro

stronger by 12 yen119US DollarAverage Rates (yen)

* Record high through all quarters


Outline of FY04 12-Month Results

+ 10.8%

+ 8.8%

+ 5.3%

- 17.2%

+ 2.4%

Change

439.43486.91**EPS (yen)

426.6464.3**Net income

609.7641.9**Income before income taxes

724.5600.1Operating income

7,971.48,162.6*Net sales & other operation revenue

FY03 FY04 (Billions of Yen)

* Record high for four fiscal years in a row

133113

weaker by 11 yen 122Eurostronger by 9 yen122US Dollar

Average Rates (yen)

** Record high


(Billions of Yen)

226.4**311.2*184.7

3,319.7

FY04

+ 33.2%170.0Net income

+ 28.3%242.6Ordinary profit

+ 27.6%144.8Operating income

- 0.1%3,322.7Net sales & otheroperation revenue

ChangeFY03

* To set record high

FY04 Unconsolidated Financial Results

3 yen

19 yen

Interim

10 yen7 yenIncrease from FY03

42 yen23 yenDividend per share

Fiscal YearEnd of FY04

** To set record high for two fiscal years in a row


FY05 Consolidated Financial Forecasts(Billions of Yen)

- 16.0%464.3390.0Net income

414.49

500.0

560.0

8,500.0*

FY05

- 14.9%486.91EPS (yen)

- 22.1%641.9Income before income taxes

- 6.7%600.1Operating income

+ 4.1%8,162.6Net sales & other operation revenue

ChangeFY04

125 105

stronger by 8 yen133Eurostronger by 8 yen113US Dollar

Average Rates (Yen)

* To set record high for five fiscal years in a row


125.0165.090.0

3,390.0*

FY05

- 44.8%226.4Net income

- 47.0%311.2Ordinary profit



ChangeFY04

FY05 Unconsolidated Financial Forecasts(Billions of Yen)

* To set record high

4 yen

23 yen

Interim

4 yen-Increase from FY04

46 yen23 yenDividend per share

Fiscal YearEnd of FY05


Aggregate number of shares acquired :approx. 35.2 million shares

Aggregate amount of acquisition :approx. 160 billion yen

Aggregate number of shares acquired :approx. 20.9 million shares

Aggregate amount of acquisition :approx. 96.9 billion yen

From June 24, 2003 to April 15, 2004

Acquisition of Common Stock

* Total shares of common stock issued and outstanding: approx. 974.41 million shares * Total shares which are base of calculation of net income per share as of FY2004:

approx. 953.63 million shares

From June 25, 2002 to April 15, 2004


· Details of FY04 Financial Results & FY05 Financial Forecasts(1) 4th Quarter Results

Net Sales by Business SegmentBusiness Segment InformationGeographic Segment InformationChange in Income before Income Taxes, Equity in Income of Affiliates

(2) 12-Month ResultsNet Sales by Business SegmentBusiness Segment InformationGeographic Segment InformationChange in Income before Income Taxes, Equity in Income of Affiliates

(3) Consolidated Balance Sheets & Cash Flows

(4) FY05 Financial Forecasts


FY04 4th Quarter Net Sales by Business Segment(Billions of Yen) 2,128.6 + 16.2

( + 0.8% )

57.660.4

1,711.1 1,694.3

263.0 294.8

0

500

1,000

1,500

2,0002,144.9

+ 31.8( + 12.1% )

FY04 4QFY03 4Q98.194.0

MotorcycleBusiness

AutomobileBusiness

Financial Services

Power Product& Other Businesses

Market average rates US$1=JPY118.94Euro1=JPY127.74

US$: - 11.67 yenEuro: + 6.33 yen


( Substantial sales increase of approx. 116 bn. yen < + 5.5% > if excluding currency translation effects < approx. 100 bn. yen > )

- 16.8( - 1.0% )

- 2.7( - 4.6% )

+ 4.0( + 4.3% )


Unit Sales of Motorcycles(Motorcycles + All-Terrain Vehicles, etc.)

JapanNorth AmericaEurope

Others

Asia

(Thousands of Unit)

123 94 120 86 103170 99 140 190 227101 57 50

197 209210

209

203

9192

1,9961,832

1,6911,4981,486

0

700

1,400

2,100

2,800

4Q 1Q 2Q 3Q 4Q

2,620

+ 552,000 units( + 26.7% )

2,068 2,0012,218

2,367

FY03 FY04


Motorcycle Operation: Japan

• Decreased sales of Lead100(100cc scooter) and Crea SCOOPY(50cc scooter)

• Increased sales of Smart Dio Z4

Unit Sales in FY04 4Q: 103,000 units( - 20,000 units from FY03 4Q )

Smart Dio Z4


Motorcycle Operation: North AmericaUnit Sales in FY04 4Q: 227,000 units

( + 57,000 units from FY03 4Q )

• Increased sales of CRF50F • Increased sales of ATVs ( + 28,000 units )

CRF50FTRX350FE


Motorcycle Operation: EuropeUnit Sales in FY04 4Q: 91,000 units

( - 1,000 units from FY03 4Q )

• Decreased sales of 50cc scooters• Increased sales of Lead and CBF600 series

Lead CBF600S


• Increased sales in India, Thailand and China

Motorcycle Operation: AsiaUnit Sales in FY04 4Q: 1,996,000 units

( + 510,000 units from FY03 4Q )

Wave 125Eterno Wave


• Increased sales in Latin America

Motorcycle Operation: Other RegionsUnit Sales in FY04 4Q: 203,000 units

( + 6,000 units from FY03 4Q )

CG125 Titan C100 Biz


19.2

5.82.3

7.4

26.87.3%

1.0%

3.3%

9.1%

2.4%

0

10

20

30

4Q 1Q 2Q 3Q 4Q0%

2%

4%

6%

8%

10%(Billions of Yen)

Motorcycle BusinessNet Sales / Operating Income / Operating Margin

OP IncomeOP Margin

FY03 FY04

263.0 294.8 ( + 12.1% )226.3233.5241.5Net Sales

(+ 39.3%)


Japan

North America

Europe

Others

Asia

(Thousands of Unit)

221153 176 177 210

402397 385 407 369

56 57 44

23 33 4338

66

7464 79 84 76

10227

0

200

400

600

800

4Q 1Q 2Q 3Q 4Q

793

+ 13,000 units( + 1.7% )

780708 735 747

FY03 FY04

Unit Sales of Automobiles


Automobile Operation: JapanUnit Sales in FY04 4Q: 210,000 units

( - 11,000 units from FY03 4Q )

• Decreased sales of Fit • Increased sales of Odyssey and Life

LifeOdyssey


Automobile Operation: North AmericaUnit Sales in FY04 4Q: 369,000 units

( - 33,000 units from FY03 4Q )

• Decreased sales of Accord

• Strong sales of Acura TSX, Acura TL and Pilot

Acura TSX Acura TL Pilot


• Favorable sales of Accord Diesel and Jazz

Automobile Operation: EuropeUnit Sales in FY04 4Q: 74,000 units

( + 10,000 units from FY03 4Q )

JazzAccord Diesel


• Strong sales in China and India

Automobile Operation: AsiaUnit Sales in FY04 4Q: 102,000 units

( + 36,000 units from FY03 4Q )

Accord City


• Strong sales in Latin America and Middle East

Automobile Operation: Other RegionsUnit Sales in FY04 4Q: 38,000 units

( + 11,000 units from FY03 4Q )

CivicFit


160.9

122.6126.2 133.6

53.3

9.4%

7.7% 8.4%

3.2%

7.6%

0

50

100

150

200

4Q 1Q 2Q 3Q 4Q0%

2%

4%

6%

8%


OP IncomeOP Margin

FY03 FY04

Automobile BusinessNet Sales / Operating Income / Operating Margin

1,711.1 1,694.3 ( - 1.0% )1,630.41,646.21,621.0Net Sales

(- 66.8%)


Japan

North America

Europe

OthersAsia

(Thousands of Unit)

119 110 135 109 123

712 634419 415

895

244

177 302

75

8485

83

592538

200

154

163153

14993

0

300

600

900

1,200

1,500

1,800

4Q 1Q 2Q 3Q 4Q

1,788

+ 72,000 units( + 4.2% )

1,716

1,217

9781,064

FY03 FY04

Unit Sales of Power Products


• Increased sales of general-purpose engines in North America

Power Products OperationUnit Sales in FY04 4Q: 1,788,000 units

( + 72,000 units from FY03 4Q)

GC engine


2.3

1.1

2.9

2.1

4.12.4%

3.8%

2.7%

4.2%

1.3%

0

1

2

3

4

5

6

4Q 1Q 2Q 3Q 4Q0%

1%

2%

3%

4%

5%

(Billions of Yen)

OP IncomeOP Margin

Power Product and Other BusinessesNet Sales / Operating Income / Operating Margin

FY03 FY04

96.0 99.8 ( + 4.0% )79.176.885.7Net Sales

(+ 78.1%)


13.0 13.8

52.7

14.920.120.5

59.0

21.5%

31.8%

25.0%23.7%

32.1%

0

30

60

90

120

4Q 1Q 2Q 3Q 4Q0%

10%

20%

30%

(Billions of Yen)

OP IncomeOP Margin

Financial ServicesNet Sales / Operating Income / Operating Margin

FY03 FY04

61.0 58.6 ( - 4.1% )59.663.563.9Net Sales

(- 10.7%)

100%96.7% 90.0%

FY03 4Q includes effects of reclassification by 45.9 billion yenFY04 4Q includes effects of reclassification by 38.8 billion yen


38.0 37.839.5

30.7

84.2

3.8% 4.2%3.2%

7.8%

4.0%

0

20

40

60

80

100

4Q 1Q 2Q 3Q 4Q0%

2%

4%

6%

8%

(Billions of Yen)

OP IncomeOP Margin

JapanNet Sales / Operating Income / Operating Margin

FY03 FY04

992.5 1,081.5 ( + 9.0%)962.3943.1943.8Net Sales

(+ 121.6%)


168.5

98.9

70.4

101.0

39.6

13.5%

6.0%

8.6%

3.5%

8.2%

0

50

100

150

200

4Q 1Q 2Q 3Q 4Q0%

3%

6%

9%

12%

15%

(Billions of Yen)

North AmericaNet Sales / Operating Income / Operating Margin

OP IncomeOP Margin

1,252.5 1,120.2 ( - 10.6% )1,173.81,167.31,211.6Net Sales

(- 76.4%)

FY03 FY04


7.0

1.4

11.5

5.8

10.72.3%

2.4%

0.8%

5.2%

4.1%

0

3

6

9

12

15

18

4Q 1Q 2Q 3Q 4Q0%

1%

2%

3%

4%

5%

6%(Billions of Yen)

EuropeNet Sales / Operating Income / Operating Margin

OP IncomeOP Margin

266.1 290.1 ( + 9.0% )186.5220.4251.3Net Sales

(- 34.7%)

FY03 FY04


7.2

10.0

14.1

10.99.5

4.7%

7.9%6.8%

4.7%

6.3%

0

5

10

15

20

4Q 1Q 2Q 3Q 4Q0%

2%

4%

6%

8%

(Billions of Yen)

AsiaNet Sales / Operating Income / Operating Margin

OP IncomeOP Margin

153.3 204.7 ( + 33.5% )160.4179.4159.4Net Sales

(+ 32.7%)

FY03 FY04


Equity in Income of Affiliates – Asia

34.9 32.7

44.3

54.5

34.5

13.3 17.1

21.1

12.311.0

0

10

20

30

40

50

60

4Q 1Q 2Q 3Q 4Q

(Billions of Yen)

Income before income taxes

Equity in Incomeof Affiliates

FY03 FY04


2.6

5.6 5.6

8.1

4.34.0%

6.3%

8.5%

4.7%

8.2%

0

2

4

6

8

10

12

4Q 1Q 2Q 3Q 4Q0%

3%

6%

9%


Other RegionsNet Sales / Operating Income / Operating Margin

OP IncomeOP Margin

65.2 93.2 ( + 42.9% )95.589.969.4Net Sales

(+ 65.8%)

FY03 FY04


177.3

106.4

-22.7

33.6

18.8

-40.0

-0.5-60.0

0

50

100

150

200

Change in Income Before Income Taxes

Revenue, model mix,

etc

CurrencyEffect

FY034Q

(Billions of Yen)

FY044Q

Cost Reduction

Increase in R&D

Factors affecting Operating Income

Increase in SG&A

Other Income & Expenses

- Increase in quality related expenses in North America

- Increase in human resourceexpenses

· Decrease of unit sales in North American Automobile Business

· Increase of unit sales in Asia, Europe, Other regions’ Automobile Businesses

Materials & Others: + 21.9 bn.Labor expenses: - 3.1 bn.

- 70.8 bn.( - 40.0% )

Change in average rates: - 31.4 bn.Translation effects: - 8.6 bn.

< FY04 4th Quarter >


177.3

106.4

-22.7

33.6

18.8

-40.0

-0.5-60.0

0

50

100

150

200


Revenue, model mix,

etc

FY034Q

(Billions of Yen)

FY044Q

Cost Reduction

Increase in R&D

Increase in SG&A


- 70.8 bn.( - 40.0% )


Gain & Loss on derivative instruments: + 8.0 bn.Difference between transaction rates and average rates: - 1.6 bn.Decrease in loss on sales and impairment ofinvestment securities, etc.: + 27.2 bn.

CurrencyEffect


Gain and Loss on Derivative Instruments and Related Others

+ 13.0- 6.7+ 6.3Foreign Currency Exchange Related*

- 5.0+ 4.5- 0.5Interest Rate and Others

+ 8.0

Change

- 2.2+ 5.8Total

FY03 4QFY04 4Q

Gain and Loss on Fair Value Adjustments for Foreign Currency Exchange Contracts

Fair Value Adjustments for the Current Quarter

Reversal of Fair Value Adjustmentsfor the Prior Quarter

- 2.8

- 7.2

+ 4.4

1Q

+ 18.2

+ 11.0

+ 7.2

2Q

- 1.3- 11.0A

+ 7.6+ 1.3B

+ 6.3- 9.7A + B

4Q3Q*Fair Value Adjustments for Foreign Currency Exchange Contracts

(Billions of Yen)


177.3

106.4

-22.7

33.6

18.8

-40.0

-0.5-60.0

0

50

100

150

200


Revenue, model mix,

etc

FY034Q

(Billions of Yen)

FY044Q

Cost Reduction

Increase in R&D

Increase in SG&A



Difference between transaction rates and average rates:

Currency effects(change in average rates / translation effects): - 40.0 bn.

+

- 41.6 bn.Currency effect on Income before income taxes:

- 1.6 bn.

- 70.8 bn.( - 40.0% ) Gain & Loss on derivative instruments: + 8.0 bn.

Difference between transaction rates and average rates: - 1.6 bn.Decrease in loss on sales and impairment ofinvestment securities, etc.: + 27.2 bn.

CurrencyEffect


---+ 3.5JPY / Others

Total

Transactions between other currencies

JPY / Euro

JPY / USD

Difference of Average Rates

-

-

+ 6 yen

- 12 yen

Change

--- 31.4

--- 5.1

128134+ 3.8119107- 33.6

FY03 4QAverage Rates

( yen )

FY04 4QAverage Rates

( yen )

Effects(Billions of Yen)

JPY/Euro

JPY/USD

Difference of Currency translation

+ 6.33 yen

- 11.67 yen

Change

127.74134.07- 8.6

118.94107.27

FY03 4Q Market Average

Rates ( yen )

FY04 4Q Market Average

Rates ( yen )


Difference between transaction rates and

average rates- 1.6

Total - 41.6

Currency Effect on Income Before Income Taxes

Impact on

Operating Income

Impact on Other Income &Expenses

(Billions of Yen)


Equity in Income of Affiliates

- 4.1

Change

Equity in income declined due to translation effectsFactors

18.314.1Equity in Income

FY03 4QFY04 4Q

(Billions of Yen)


FY04 12 Months - Net Sales by Business Segment(Billions of Yen) 7,971.4

242.6237.9

6,440.0 6,592.0

978.0 996.2

0

2,000

4,000

6,000

8,0008,162.6

FY04FY03331.5315.3

MotorcycleBusiness

AutomobileBusiness

Financial ServicesPower Product& Other Businesses


US$: - 8.88 yenEuro: + 11.57 yen


( Substantial sales increase of approx. 506 bn. yen < + 6.4% > if excluding currency translation effects < approx. 315 bn. yen > )

+ 191.1( + 2.4% )

+ 18.1( + 1.9% )

+ 151.9( + 2.4% )

+ 4.7( + 2.0% )

+ 16.2( + 5.1% )


Unit Sales of Motorcycles(Motorcycles + All-Terrain Vehicles, etc.)

JapanNorth America

Europe

Others

Asia

(Thousands of Unit)

440 407 404 432 403519 590 610 656341 315 305

785

831

394

299389

7,0175,948

4,7863,851

3,213

0

2,000

4,000

6,000

8,000

10,000

FY00 FY01 FY02 FY03 FY04

9,206

+ 1,126,000( + 13.9% )

4,4365,118

6,095

8,080


42.4

57.2

69.6

56.447.2

7.0%

4.3%

5.9%

7.3%6.6%

0

20

40

60

80

100

FY00 FY01 FY02 FY03 FY040%

2%

4%

6%

8%(Billions of Yen)

Motorcycle BusinessNet Sales / Operating Income / Operating Margin

OP IncomeOP Margin

718.9 996.2 ( + 1.9% )978.0947.9805.3Net Sales

(- 25.9%)


Japan

North America

Europe

OthersAsia

(Thousands of Unit)

706 776 878 849 716

1,295 1,346 1,368 1,5221,558

191176

207

105 137

223 231249

267 244205 341

0

500

1,000

1,500

2,000

2,500

3,000


2,983

2,473 2,580 2,6662,888

Unit Sales of Automobiles+ 95,000( + 3.3% )


348.0320.0

520.5551.3

438.8

7.0%

8.8% 8.6%

6.7%6.1%

0

100

200

300

400

500

600

700

FY00 FY01 FY02 FY03 FY040%

3%

6%

9%(Billions of Yen)

OP IncomeOP Margin

Automobile BusinessNet Sales / Operating Income / Operating Margin

4,961.0 6,592.0 ( + 2.4% )6,440.05,929.75,231.3Net Sales

(- 20.4%)


Japan

North America

Europe

Others

Asia

(Thousands of Unit)

183 164 409 472 477

1,614 1,4121,601

1,8722,363

1,2691,012

1,290

293327

1,325

1,2619351,039 904

657619

0

1,000

2,000

3,000

4,000

5,000


5,047

4,057 3,884 3,926

4,584

Unit Sales of Power Products

+ 463,000( + 10.1% )


12.8-0.3

4.08.0 10.3

4.4%

1.4%

2.5%3.0%

-0.1%

-10

0

10

20

30

FY00 FY01 FY02 FY03 FY04-2%

0%

2%

4%

6%(Billions of Yen)

OP IncomeOP Margin

Power Product and Other BusinessesNet Sales / Operating Income / Operating Margin

288.8 341.6 ( + 4.7% )326.3293.8264.7Net Sales

(+ 28.3%)


61.9 69.6108.4107.8

45.030.8

18.0

12.5%

21.5%

25.7%28.3%

17.5%

0

40

80

120

160

200

FY00 FY01 FY02 FY03 FY040%

10%

20%

30%

(Billions of Yen)

OP IncomeOP Margin

Financial ServicesNet Sales / Operating Income / Operating Margin

147.7 245.8 ( + 2.0% )240.9209.3176.0Net Sales

(+ 0.6%)

50%44.7% 44.1%

FY03 includes effects of reclassification by 45.9 billion yenFY04 includes effects of reclassification by 38.8 billion yen


116.3146.0

253.4

191.4 192.43.4%

6.6%

4.9% 4.9%4.1%

0

50

100

150

200

250

300

FY00 FY01 FY02 FY03 FY040%

2%

4%

6%

(Billions of Yen)

OP IncomeOP Margin

JapanNet Sales / Operating Income / Operating Margin

3,448.2 3,930.8 (+ 0.3%)3,918.93,811.03,594.5Net Sales

(+ 0.5%)


273.0 276.5

402.3444.3

310.1

8.2%9.3% 9.4%

6.6%7.7%

0

100

200

300

400

500

FY00 FY01 FY02 FY03 FY040%

2%

4%

6%

8%


North AmericaNet Sales / Operating Income / Operating Margin

OP IncomeOP Margin

3,331.5 4,673.0 (- 0.8% )4,711.94,307.93,608.4Net Sales

(- 30.2%)


-55.5-35.3

14.425.8

-2.1%

-5.9%

1.8%2.7%

-10.1%-60

-40

-20

0

20

40

FY00 FY01 FY02 FY03 FY04-15%

-10%

-5%

0%

5%

10%

-14.4

(Billions of Yen)

EuropeNet Sales / Operating Income / Operating Margin

OP IncomeOP Margin

678.5 948.5 ( + 15.0% )824.5603.5547.2Net Sales

(+ 78.2%)


37.844.6

7.2%6.3%

0

20

40

60

80

FY00 FY01 FY02 FY03 FY040%

2%

4%

6%

8%


AsiaNet Sales / Operating Income / Operating Margin

OP IncomeOP Margin

704.1 ( + 34.6% )523.1Net Sales

(+18.2%)

Notes: ‘Asia’ was included in ‘OtherRegions’ prior to FY04 and are not re-classified for periods prior to FY03


Equity in Income of Affiliates – Asia

166.1

138.4

61.748.2

0

30

60

90

120

150

180


(Billions of Yen)

Income before income taxes

Equity in Incomeof Affiliates



23.2 23.7

8.5%

6.8%

0

10

20

30

40

FY00 FY01 FY02 FY03 FY040%

2%

4%

6%

8%


Other RegionsNet Sales / Operating Income / Operating Margin

OP IncomeOP Margin

348.2 ( + 26.9% )274.3Net Sales

(+ 2.5%)




Revenue, model mix,

etcCurrency

Effect

(Billions of Yen)

< FY04 12 Months >

Cost Reduction Increase

in R&D

Increase in SG&A


609.7 641.9

23.1156.5

58.8

-101.0-12.1-93.2

0

200

400

600

800

Factors affecting Operating Income

- Increase in human resource & quality related expenses

- Allowance for financial services- Increase of unit sales in Overseas

Automobile Businesses- Increase of unit sales in Asian

Motorcycle Business


Change in average rates: - 74.9 bn.Translation effects: - 26.1 bn.

FY03 FY04

+ 32.1 bn.( + 5.3% )



Revenue, model mix,

etcCurrency

Effect

(Billions of Yen)

< FY04 12 Months >+ 32.1 bn.( + 5.3% )

Cost Reduction

Increase in SG&A


609.7 641.9

23.1156.5

58.8

-101.0-12.1-93.2

0

200

400

600

800

FY03 FY04

Gain & Loss on derivative instruments: + 118.8 bn.Difference between transaction rates and average rates: + 4.1 bn.Decrease in loss on sales and impairment ofinvestment securities, etc. + 33.6 bn.

Increase in R&D



Revenue, model mix,

etcCurrency

Effect

(Billions of Yen)

< FY04 12 Months >+ 32.1 bn.( + 5.3% )

Cost Reduction

Increase in SG&A


609.7 641.9

23.1156.5

58.8

-101.0-12.1-93.2

0

200

400

600

800

FY03 FY04

Gain & Loss on derivative instruments: + 118.8 bn.Difference between transaction rates and average rates: + 4.1 bn.Decrease in loss on sales and impairment ofinvestment securities, etc. + 33.6 bn.

Difference between transaction rates and average rates:

Currency effects(change in average rates / translation effects): - 101.0 bn.

+

- 96.9 bn.Currency effect on Income before income taxes:

+ 4.1 bn.

Increase in R&D


---+ 17.7JPY / Others

Total

Transactions between other currencies

JPY / Euro

JPY / USD

Difference of Average Rates

-

-

+ 11 yen

- 9 yen

Change

--- 74.9

--- 12.8

122133+ 17.8122113- 97.6

FY03Average Rates

( yen )

FY04Average Rates

( yen )


JPY/Euro

JPY/USD

Difference of Currency translation

+ 11.57 yen

- 8.88 yen

Change

121.04132.61- 26.1

121.95113.07

FY03Market Average

Rates ( yen )

FY04 Market Average

Rates ( yen )


Difference between transaction rates and

average rates+ 4.1

Total - 96.9

Currency Effect on Income Before Income Taxes

Impact on

Operating Income

Impact on Other Income &Expenses

(Billions of Yen)


Equity in Income of Affiliates

+ 13.1

Change

Equity in income rose mainly due to increased income of affiliates in AsiaFactors

61.975.1Equity in Income

FY03FY04

(Billions of Yen)


Consolidated Balance Sheets

*Excluding currency effect

(Billions of Yen)

+ 1,290.0+ 647.47,681.28,328.7Total Assets+ 740.0+ 314.33,327.53,641.9Financial Subsidiaries only

+ 98.0+ 41.11,394.31,435.5Property, plant and equipment only

Change Actual difference*End of FY03End of FY04

+ 840.0+ 402.75,051.55,454.3Total Liabilities+ 570.0( + 610.0 )

( - 40.0 )

+ 293.5( + 337.5 )

( - 44.0 )

2,322.4( 2,049.8 )

( 272.6 )

2,616.0( 2,387.4 )

( 228.5 )

Interest Bearing Debt only( Financial Subsidiaries only )

( Non-financial services business )

- 19.8- 28.5286.8258.3Capital Expenditures

- 1.6- 6.4205.5199.0Depreciation

Change Actual difference*FY03FY04

( Capital Expenditure & Depreciation are amount of Property, plant & Equipment < but excluding company vehicles > )

stronger by 0.95 yen

stronger by 14.51 yen

129.83128.88Euro

120.20105.69 US Dollar

Exchange rates


547.4

724.4

712.9

459.5

-967.4-28.0

0

200

400

600

800

1,000

1,200

1,400

Beginning Balance

Operating Activities

Investing Activities

FY04 Consolidated Cash Flows

(Billions of Yen)

Financing Activities

Currency Effects

Cash & cash equivalents

FY04Ending Balance


FY04

Increase of 177.0 billion yen


547.4

724.4

712.9

459.5

-967.4-28.0

0

200

400

600

800

1,000

1,200

1,400

Beginning Balance



FY04 Consolidated Cash Flows

(Billions of Yen)


Currency Effects


FY04Ending Balance


FY04

Increase of 177.0 billion yen

Free cash flow- 254.4 bn.


530.3

707.9

548.6 -165.7

-178.3

-26.9

0

300

600

900

1,200

Beginning Balance



(Billions of Yen)


Currency Effects


FY04Ending Balance


FY04

Free cash flow370.3 bn.

FY04 Cash Flows from Operating ActivitiesIncrease of

177.5 billion yen


432 403656

3,8514,786

785

831

370404407610590519 715341 315 305 299

295

5,9486,980 7,017

930

0

2,000

4,000

6,000

8,000

10,000


6,095

8,0809,206 9,290

5,118

(Thousands of Unit)

Forecast: Unit Sales of Motorcycles(Motorcycles + All-Terrain Vehicles, etc.)

Asia

JapanN. AmericaEurope

Forecast

Others

+ 84,000


849 716 770

1,558

205267 244

105 137155

776 878

1,5651,346 1,368 1,522

255231207176191

510341

0

500

1,000

1,500

2,000

2,500

3,000

3,500


2,6662,888 2,983

3,255

2,580

(Thousands of Unit)

Others

Japan

N. America

Europe

Forecast: Unit Sales of Automobiles

Forecast

Asia

+ 272,000

China:151,000China:270,000


472 477 420

2,363

657619

790

1,039 904

293327

250

164 409

2,840

1,4121,601 1,872

1,3001,261

1,2901,012

1,269

0

1,000

2,000

3,000

4,000

5,000

6,000


3,884 3,926

5,0475,600

4,584

(Thousands of Unit)

Asia

Japan

N. America

Europe

Forecast

Forecast: Unit Sales of Power Products

Others

+ 553,000


Forecast: Net Sales

0

2,000

4,000

6,000

8,000


Financial Services

Automobiles

Motorcycles

Billions of Yen

Power Product & Other Businesses

6,463.87,362.4

7,971.4 8,162.68,500.0

+ 337.4 bn. ( + 4.1% )

Forecast


FY05 Consolidated Financial Forecasts(Billions of Yen)

- 16.0%464.3390.0Net income

414.49

500.0

560.0

8,500.0*

FY05

- 14.9%486.91EPS (yen)

- 22.1%641.9Income before income taxes



ChangeFY04

125 105

stronger by 8 yen133Eurostronger by 8 yen113US Dollar

Average Rates (Yen)

* To set record high for five fiscal years in a row


Forecast of Change in Income Before Income Taxes

Revenue, model mix,

etc

CurrencyEffect

(Billions of Yen)

- 141.9 bn.( - 22.1% )

Cost Reduction

Increase in R&DDecrease

in SG&A


641.9500.0

55.0

-102.0

42.0-139.0

-21.023.0

300

400

500

600

700

800

FY04 FY05Forecast


Gain & Loss on derivative instruments: - 89.0 bn.Others: - 13.0 bn.

Change in average ratesU.S. Dollar vs. Yen: - 70.0 bn.Euro vs. Yen: - 10.0 bn.Others vs. Yen: - 16.0 bn.Between other currencies: - 20.0 bn.

Translation effectsGross profit: - 71.0 bn.SG&A: + 48.0 bn.

Total currency effects: - 139.0 bn.


+ 4.7%

+ 0.5%

+ 12.3%

Change

448.9470.0R & D

199.0200.0Depreciation

258.3290.0Capital Expenditure

FY04FY05(Billions of Yen)

FY05 Consolidated Financial Forecasts

( Capital Expenditure & Depreciation are amounts of Property, plant & Equipment < but excluding company vehicles> )


Caution with Respect to Forward-Looking Statement:

This slide contains forward-looking statements about the future 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 foreign exchange rates between the Japanese yen and other major currencies, as well as other factors detailed from time to time.

Segment Information:

The segment information has been prepared in accordance with a Ministerial Ordinance under the Securities and Exchange Law of Japan, which requires certain additional information to be disclosed, including business and geographical segment information.

fy04 4 fy04 4

Economy & Finance

month results 7fy05

month results 12fy04

month results 1fy04

quarter net sales

yen euro1

yen23 yen

income of affiliates

quarter resultsnet sales