TOKYO, April 27: Japan’s number two automaker Honda Motor Co. Ltd. said on Friday a weaker yen helped boost its annual net profit 56.2 per cent to a record $2.8 billion, and predicted more growth ahead.

Its group pre-tax profit for the year to March rose 43.2 per cent to a best ever 551.3 billion yen, while revenue rose 13.9 per cent to a record 7,362.4 billion yen.

Automobile unit sales both in Japan and North America increased, reflecting customers’ strong demand for Honda’s automobiles, the firm said in a statement.

In addition, Honda’s continuing cost-cutting strategies together with a weaker yen were the major contributing factors, it said.

While the record profits did not surprise analysts, its bullish forecast for another record-setting year to March 2003, with a 26.8 per cent rise in net profit to 460 billion yen — was at the top of analysts’ range.

It is extremely bullish, said Koji Endo, auto analyst for Credit Suisse First Boston, who nonetheless expressed confidence the firm would meet the target.

Honda also forecast an annual 700 billion yen in pre-tax income and 8,100 billion yen in reease.

It’s bullish in terms of volume and product mix, as well as in terms of a reduction in incentives and a reduction in inventories, Endo said.

So it seems that even without the effect of exchange rates, they are forecasting significan Japan, he said.

Despite its positive forecast, Honda said it expects competition in global markets to remain challenging.

As a whole, the global business environment for the foreseeable future is expected to remain beset, it said.

The formal approval is expected to come at a general shareholders meeting set for June re-use in stock options and other areas, but would no longer be traded.

The average exchange rate over the past fiscal year was 125.14 yen to the dollar, a 13.2 per cent rise from the previous year, at 110.59, Honda said. —AFP