April 27, 2018 HONDA MOTOR CO., LTD. REPORTS …

HONDA MOTOR CO., LTD. REPORTS CONSOLIDATED FINANCIAL RESULTS FOR THE FISCAL FOURTH QUARTER AND THE FISCAL YEAR ENDED MARCH 31, 2018

April 27, 2018

Tokyo, April 27, 2018--- Honda Motor Co., Ltd. today announced its consolidated financial results for the fiscal fourth quarter and the fiscal year ended March 31, 2018.

Fourth Quarter Results

Honda's consolidated profit for the period attributable to owners of the parent for the fiscal fourth quarter ended March 31, 2018 totaled JPY 107.7 billion, an increase of 12.3% from the same period last year. Earnings per share attributable to owners of the parent for the quarter amounted to JPY 60.59, an increase of JPY 7.35 from the corresponding period last year. One Honda American Depository Share represents one common share.

Consolidated sales revenue for the quarter amounted to JPY 3,914.7 billion, an increase of 4.0% from the same period last year, due primarily to increased sales revenue in all business operations, despite unfavorable foreign currency translation effects.

Consolidated operating profit for the quarter amounted to JPY 126.8 billion, a decrease of 8.2% from the same period last year, due primarily to increased SG&A expenses and unfavorable foreign currency effects, despite continuing cost reduction efforts.

Share of profit of investments accounted for using the equity method for the quarter amounted to JPY 57.9 billion, an increase of 19.2% from the corresponding period last year.

Consolidated profit before income taxes for the quarter totaled JPY 190.4 billion, an increase of 1.8% from the corresponding period last year, mainly due to increased share of profit of investments accounted for using the equity method.

Fiscal Year Results

Honda's consolidated profit for the year attributable to owners of the parent for the fiscal year ended March 31, 2018 totaled JPY 1,059.3 billion, an increase of 71.8% from the previous fiscal year, mainly due to impacts of the enactment of the U.S. Tax Cuts and Jobs Act. Earnings per share attributable to owners of the parent for the year amounted to JPY 590.79, an increase of JPY 248.69 from the previous fiscal year.

Consolidated sales revenue for the year amounted to JPY 15,361.1 billion, an increase of 9.7% from the previous fiscal year, due primarily to increased sales revenue in all business operations as well as favorable foreign currency translation effects.

Consolidated operating profit for the year amounted to JPY 833.5 billion, a decrease of 0.9% from the previous fiscal year, due primarily to increased SG&A expenses, the loss related to the settlement of multidistrict class action litigation and the reverse effect from the impact of pension plan amendments in the previous fiscal year, despite an

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increase in sales revenue and model mix and continuing cost reduction efforts. Share of profit of investments accounted for using the equity method for the year amounted to JPY 247.6 billion, an increase of 50.3% from the previous fiscal year. Consolidated profit before income taxes for the year totaled JPY 1,114.9 billion, an increase of 10.7% from the previous fiscal year, mainly due to increased share of profit of investment accounted for using the equity method.

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Consolidated Statements of Financial Position for the Fiscal Year Ended March 31, 2018 Total assets increased by JPY 391.0 billion, to JPY 19,349.1 billion from March 31, 2017, mainly due to increased Inventory and Receivables from financial services. Total liabilities decreased by JPY 273.4 billion, to JPY 11,115.0 billion from March 31, 2017, mainly due to decreased Deferred tax liabilities and foreign currency translation effects, despite increased Financial liabilities and Trade payables. Total equity increased by JPY 664.4 billion, to JPY 8,234.0 billion from March 31, 2017 due mainly to an increase in Retained earnings, despite a decrease attributable to acquisition of the Company's own shares.

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Consolidated Statements of Cash Flow for the Fiscal Year Ended March 31, 2018 Consolidated cash and cash equivalents on March 31, 2018 increased by JPY 150.5 billion from March 31, 2017, to JPY 2,256.4 billion. The reasons for the increases or decreases for each cash flow activity, when compared with the previous fiscal year, are as follows: Cash flow from operating activities Net cash provided by operating activities amounted to JPY 987.6 billion for the fiscal year ended March 31, 2018. Cash inflows from operating activities increased by JPY 102.5 billion compared with the previous fiscal year due mainly to an increase in cash received from customers, despite increased payments for parts and raw materials. Cash flow from investing activities Net cash used in investing activities amounted to JPY 615.1 billion. Cash outflows from investing activities decreased by JPY 35.5 billion compared with the previous fiscal year, due mainly to a decrease in Payments for additions to property, plant and equipment. Cash flow from financing activities Net cash used in financing activities amounted to JPY 174.3 billion. Cash outflows from financing activities increased by JPY 289.7 billion compared with the previous fiscal year, due mainly to a decrease in proceeds from financing liabilities and purchases of treasury stock.

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Forecasts for the Fiscal Year Ending March 31, 2019

In regard to the forecasts of the financial results for the fiscal year ending March 31, 2019, Honda projects consolidated results to be as shown below:

Fiscal year ending March 31, 2019

Yen (billions)

Changes from FY2018

Sales revenue Operating profit Profit before income taxes Profit for the year Profit for the year attributable to owners of the parent

Earnings per share attributable to owners of the parent

Basic and diluted

15,600.0 700.0 920.0 635.0 570.0

Yen

322.42

+1.6% -16.0% -17.5% -43.7%

-46.2%

Note: The forecasts are based on the assumption that the average exchange rates for the Japanese yen to the U.S. dollar will be JPY 105 for the full year ending March 31, 2019.

The reasons for the increases or decreases in the forecasts of the operating profit, and profit before income taxes for the fiscal year ending March 31, 2019 from the previous year are as follows.

Yen (billions)

Revenue, model mix, etc.

+40.5

Cost reduction, the effect of raw material cost fluctuations, etc.

+67.0

SG&A expenses

-51.0

R&D expenses

-22.0

Currency effect

-207.0

Settlement of multidistrict class action litigation*

53.7

Restitution income*

-14.7

Operating profit compared with fiscal year 2018

-133.5

Share of profit of investments

accounted for using the equity method

-32.6

Finance income and finance costs

-28.7

Profit before income taxes compared with fiscal year 2018

-194.9

* Litigation settlement and restitution income related to airbag inflator included in SG&A expenses in fiscal year 2018

This announcement contains "forward-looking statements" as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are based on management's assumptions and beliefs taking into account information currently available to it. Therefore, please be advised that the actual results of the Company could differ materially from those described in these forward-looking statements as a result of numerous factors, including general economic conditions in the principal markets of the Company, its consolidated subsidiaries and its affiliates accounted for by the equity-method, and fluctuation of foreign exchange rates, as well as other factors detailed from time to time. The various factors for increases and decreases in profit have been classified in accordance with a method that Honda considers reasonable.

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Dividend per Share of Common Stock Fiscal fourth quarter dividend is JPY 27 per share of common stock. The total annual dividend per share of common stock for the fiscal year ending March 31, 2018, is JPY 100 per share. The Company expects to distribute quarterly cash dividends of JPY 27 per share for each quarter for the fiscal year ending March 31, 2019. As a result, total cash dividends for the fiscal year ending March 31, 2019 are expected to be JPY 108 per share. Basic Rationale for Selection of Accounting Standards The Company adopted IFRS for the Company's consolidated financial statements from the year ended March 31, 2015 which have been included in the annual securities report (to be submitted to the Financial Services Agency of Japan) and Form 20-F (to be submitted to the U.S. Securities and Exchange Commission), aiming at improving comparability of financial information across international capital markets as well as standardization of financial information and enhancing efficiency of financial reporting of the Company and its consolidated subsidiaries.

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Consolidated Financial Summary For the three months and the years ended March 31, 2017 and 2018

Financial Highlights

Sales revenue Operating profit (loss) Profit (loss) before income taxes Profit (loss) for the period attributable to owners of the parent

Earnings (loss) per share attributable to owners of the parent

Basic and diluted

Three months ended

Mar. 31, 2017

3,763,434 138,102 186,993

95,959

53.24

Yen (millions)

Three months ended

Mar. 31, 2018

3,914,728

126,826

190,448

Year ended Mar. 31, 2017

13,999,200 840,711

1,006,986

107,745

616,569

Yen

60.59

342.10

Year ended Mar. 31, 2018

15,361,146 833,558

1,114,973 1,059,337

590.79

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[1] Consolidated Statements of Financial Position

Assets Current assets:

Cash and cash equivalents Trade receivables Receivables from financial services Other financial assets Inventories Other current assets

Total current assets Non-current assets:

Investments accounted for using the equity method Receivables from financial services Other financial assets Equipment on operating leases Property, plant and equipment Intangible assets Deferred tax assets Other non-current assets

Total non-current assets Total assets

Liabilities and Equity Current liabilities:

Trade payables Financing liabilities Accrued expenses Other financial liabilities Income taxes payable Provisions Other current liabilities

Total current liabilities Non-current liabilities:

Financing liabilities Other financial liabilities Retirement benefit liabilities Provisions Deferred tax liabilities Other non-current liabilities

Total non-current liabilities Total liabilities Equity:

Common stock Capital surplus Treasury stock Retained earnings Other components of equity

Equity attributable to owners of the parent Non-controlling interests Total equity Total liabilities and equity

Yen (millions)

Mar. 31, 2017

Mar. 31, 2018

2,105,976 764,026

1,878,938 149,427

1,364,130 292,970

6,555,467

597,262 3,070,615

364,612 4,104,663 3,200,378

778,192 121,509 165,425 12,402,656 18,958,123

1,183,344 2,786,928

417,736 119,784 45,507 348,095 527,448 5,428,842

4,022,190 47,241 494,131 248,935

900,450 246,708 5,959,655 11,388,497

86,067 171,118 (26,189) 6,712,894 351,406 7,295,296 274,330 7,569,626 18,958,123

2,256,488 800,463

1,840,699 213,177

1,523,455 291,006

6,925,288

679,517 3,117,364

436,555 4,088,133 3,062,433

741,514 129,338 169,022 12,423,876 19,349,164

1,224,627 2,917,261

404,719 115,405 53,595 305,994 602,498 5,624,099

3,881,749 60,005 404,401 220,625 629,722 294,468

5,490,970 11,115,069

86,067 171,118 (113,271) 7,611,332 178,292 7,933,538 300,557 8,234,095 19,349,164

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