Segment Information | (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 side-by-sides Research and development Automobile Business Automobiles and relevant parts Research and development Financial Services Business Financial services Retail loan and lease related to Life Creation and Other Businesses Power products and relevant parts, and others Research and development (a) Segment Information Segment information as of and for the nine months ended December 31, 2020 and 2021 is as follows: As of and for the nine months ended December 31, 2020 Yen (millions) Motorcycle Automobile Financial Life Creation Segment Reconciling 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 As of and for the nine months ended December 31, 2021 Yen (millions) Motorcycle Automobile Financial Life Creation Segment Reconciling Consolidated Sales revenue: External customers ¥ 1,602,096 ¥ 6,668,657 ¥ 2,114,335 ¥ 291,925 ¥ 10,677,013 ¥ — ¥ 10,677,013 Intersegment — 155,020 2,124 17,041 174,185 (174,185 ) — Total 1,602,096 6,823,677 2,116,459 308,966 10,851,198 (174,185 ) 10,677,013 Segment profit (loss) ¥ 232,395 ¥ 188,547 ¥ 258,149 ¥ (7,446 ) ¥ 671,645 ¥ — ¥ 671,645 Segment assets ¥ 1,465,871 ¥ 8,795,380 ¥ 10,914,940 ¥ 385,776 ¥ 21,561,967 ¥ 687,812 ¥ 22,249,779 Depreciation and amortization 49,127 381,128 661,252 12,728 1,104,235 — 1,104,235 Capital expenditures 30,189 287,082 1,639,003 10,501 1,966,775 — 1,966,775 Segment information for the three months ended December 31, 2020 and 2021 is as follows: For the three months ended December 31, 2020 Yen (millions) Motorcycle Automobile Financial Life Creation Segment Reconciling 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 For the three months ended December 31, 2021 Yen (millions) Motorcycle Automobile Financial Life Creation Segment Reconciling Consolidated Sales revenue: External customers ¥ 578,366 ¥ 2,333,388 ¥ 671,777 ¥ 105,254 ¥ 3,688,785 ¥ — ¥ 3,688,785 Intersegment — 55,365 834 6,008 62,207 (62,207 ) — Total 578,366 2,388,753 672,611 111,262 3,750,992 (62,207 ) 3,688,785 Segment profit (loss) ¥ 84,258 ¥ 71,443 ¥ 81,335 ¥ (7,587 ) ¥ 229,449 ¥ — ¥ 229,449 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 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, 2020 and 2021 amounted to ¥931,069 million and ¥847,711 million, respectively, which consist primarily of the Company’s cash and cash equivalents and financial assets measured at fair value through other comprehensive income. (b) Supplemental Geographical Information In addition to the disclosure required by IFRS, Honda provides the following supplemental information for the financial statements users: Supplemental geographical information based on the location of the Company and its subsidiaries As of and for the nine months ended December 31, 2020 Yen (millions) Japan North Europe Asia Other Total Reconciling Consolidated Sales revenue: External customers ¥ 1,559,844 ¥ 5,200,322 ¥ 350,963 ¥ 2,124,773 ¥ 310,811 ¥ 9,546,713 ¥ — ¥ 9,546,713 Inter-geographic areas 1,189,865 270,594 121,711 329,638 4,509 1,916,317 (1,916,317 ) — Total 2,749,709 5,470,916 472,674 2,454,411 315,320 11,463,030 (1,916,317 ) 9,546,713 Operating profit (loss) ¥ (31,386 ) ¥ 269,236 ¥ 18,352 ¥ 170,069 ¥ 421 ¥ 426,692 ¥ 20,308 ¥ 447,000 Assets ¥ 5,048,475 ¥ 11,271,264 ¥ 666,494 ¥ 2,996,726 ¥ 484,914 ¥ 20,467,873 ¥ 312,330 ¥ 20,780,203 Non-current ¥ 3,038,243 ¥ 4,637,887 ¥ 58,660 ¥ 643,185 ¥ 114,368 ¥ 8,492,343 ¥ — ¥ 8,492,343 As of and for the nine months ended December 31, 2021 Yen (millions) Japan North Europe Asia Other Total Reconciling Consolidated Sales revenue: External customers ¥ 1,713,992 ¥ 5,681,155 ¥ 440,255 ¥ 2,400,719 ¥ 440,892 ¥ 10,677,013 ¥ — ¥ 10,677,013 Inter-geographic areas 1,506,703 341,172 89,067 491,398 7,479 2,435,819 (2,435,819 ) — Total 3,220,695 6,022,327 529,322 2,892,117 448,371 13,112,832 (2,435,819 ) 10,677,013 Operating profit (loss) ¥ 26,663 ¥ 414,075 ¥ 17,764 ¥ 232,250 ¥ 18,642 ¥ 709,394 ¥ (37,749 ) ¥ 671,645 Assets ¥ 5,250,120 ¥ 12,310,903 ¥ 553,219 ¥ 3,491,191 ¥ 505,794 ¥ 22,111,227 ¥ 138,552 ¥ 22,249,779 Non-current ¥ 3,006,685 ¥ 5,196,501 ¥ 55,887 ¥ 667,201 ¥ 133,948 ¥ 9,060,222 ¥ — ¥ 9,060,222 For the three months ended December 31, 2020 Yen (millions) Japan North Europe Asia Other Total Reconciling Consolidated Sales revenue: External customers ¥ 559,587 ¥ 2,068,582 ¥ 114,672 ¥ 892,829 ¥ 135,899 ¥ 3,771,569 ¥ — ¥ 3,771,569 Inter-geographic areas 518,693 99,268 58,881 136,149 1,887 814,878 (814,878 ) — Total 1,078,280 2,167,850 173,553 1,028,978 137,786 4,586,447 (814,878 ) 3,771,569 Operating profit (loss) ¥ 43,691 ¥ 149,920 ¥ 7,114 ¥ 79,132 ¥ (1,653 ) ¥ 278,204 ¥ (469 ) ¥ 277,735 For the three months ended December 31, 2021 Yen (millions) Japan North Europe Asia Other Total Reconciling Consolidated Sales revenue: External customers ¥ 607,190 ¥ 1,849,299 ¥ 122,244 ¥ 949,803 ¥ 160,249 ¥ 3,688,785 ¥ — ¥ 3,688,785 Inter-geographic areas 514,470 104,766 8,779 181,501 2,340 811,856 (811,856 ) — Total 1,121,660 1,954,065 131,023 1,131,304 162,589 4,500,641 (811,856 ) 3,688,785 Operating profit (loss) ¥ 11,614 ¥ 134,619 ¥ 4,897 ¥ 98,383 ¥ 1,575 ¥ 251,088 ¥ (21,639 ) ¥ 229,449 Explanatory notes: 1. Major countries in each geographic area: North America United States, Canada, Mexico Europe United Kingdom, Germany, Belgium, Italy, France Asia Thailand, China, India, Vietnam, Malaysia Other Regions Brazil, Australia 2. Operating profit (loss) of each geographical region 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. 3. Assets of each geographical region are defined as total assets including investments accounted for using the equity method, derivatives, and deferred tax assets. 4. Sales revenues between geographic areas are generally made at values that approximate arm’s-length 5. Reconciling items include elimination of inter-geographic transactions and balances as well as unallocated corporate assets. Unallocated corporate assets, included in reconciling items as of December 31, 2020 and 2021 amounted to ¥931,069 million and ¥847,711 million, respectively, which consist primarily of the Company’s cash and cash equivalents and financial assets measured at fair value through other comprehensive income. |