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American Honda Finance

American Honda Finance Corporation (AHFC) is a California corporation that was incorporated on February 6, 1980. Unless otherwise indicated by the context, all references to the “Company”, “we”, “us”, and “our” in this report include AHFC and its consolidated subsidiaries, and references to “AHFC” refer solely to American Honda Finance Corporation (excluding its subsidiaries). AHFC is a wholly-owned subsidiary of American Honda Motor Co. Inc. (AHM). Honda Canada Finance Inc. (HCFI) is a majority-owned subsidiary of AHFC. Noncontrolling interest in HCFI is held by Honda Canada Inc. (HCI), an affiliate of AHFC. AHM is a wholly-owned subsidiary and HCI is an indirect wholly-owned subsidiary of Honda Motor Co. Ltd. (HMC). AHM and HCI are the sole authorized distributors of Honda and Acura products including motor vehicles, parts, and accessories in the United States and Canada. AHFC’s principal executive offices are located at 20800 Madrona Avenue, Torrance, California 90503. We provide various forms of financing in the United States and Canada to purchasers and lessees of Honda and Acura products and authorized independent dealers of Honda and Acura products. Our primary focus, in collaboration with AHM and HCI, is to provide support for the sale of Honda and Acura products and maintain customer and dealer satisfaction and loyalty. Our business is substantially dependent upon the sale of those Honda and Acura products in the United States and Canada and the percentage of those sales financed by us.

Calendar

11 Feb 21
13 Apr 21
31 Mar 22
Quarter (USD)
Dec 20 Sep 20 Jun 20 Mar 20
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Annual (USD)
Mar 20 Mar 19 Mar 18 Mar 17
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS

Financial data from company earnings reports.

Cash burn rate (estimated) Burn method: Change in cash Burn method: Operating income/loss Burn method: FCF (opex + capex)
Last Q Avg 4Q Last Q Avg 4Q Last Q Avg 4Q
Cash on hand (at last report) 3.44B 3.44B 3.44B 3.44B 3.44B 3.44B
Cash burn (monthly) 8.67M (positive/no burn) (positive/no burn) (positive/no burn) (positive/no burn) (positive/no burn)
Cash used (since last report) 29.83M n/a n/a n/a n/a n/a
Cash remaining 3.41B n/a n/a n/a n/a n/a
Runway (months of cash) 393.4 n/a n/a n/a n/a n/a

Beta Read what these cash burn values mean

Financial report summary

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Risks
  • Because our operations are heavily dependent on retail sales of motor vehicles and other retail products, a decline in general business and economic conditions can have a significant adverse impact on our results of operations, cash flows, and financial condition.
  • Fluctuations in interest rates could have an adverse impact on our results of operations, cash flows, and financial condition.
  • Our results of operations, cash flows, and financial condition may be adversely affected because of currency risk.
  • We need substantial capital to finance our operations and a disruption in our funding sources and access to the capital markets would have an adverse effect on our results of operations, cash flows, and financial condition.
  • Our borrowing costs and access to the debt capital markets depend significantly on our credit ratings, the credit ratings of HMC and the Keep Well Agreements.
  • We are subject to consumer and dealer credit risk, which could adversely impact our results of operations, cash flows, and financial condition.
  • We are exposed to residual value risk on the vehicles we lease.
  • We are required to apply significant judgments and assumptions in the preparation of our financial statements, and actual results may vary from those assumed in our judgments and assumptions.
  • The failure or commercial soundness of our counterparties and other financial institutions may have an adverse effect on our results of operations, cash flows, or financial condition.
  • If we are unable to compete successfully or if competition continues to increase in the businesses in which we operate, our results of operations, cash flows, and financial condition could be materially and adversely affected.
  • Our results of operations may be adversely affected by the rate of prepayment of our financing and leasing contracts.
  • Changes in laws and regulations, or the application thereof, may adversely affect our business, results of operations, cash flows, and financial condition.
  • Financial or consumer regulations may adversely affect our business, results of operations, cash flows and financial condition.
  • Adverse economic conditions or changes in laws in states or provinces in which we have customer concentrations may negatively affect our results of operations, cash flows, and financial condition.
  • A failure or interruption in our operations could adversely affect our results of operations and financial condition.
  • A security breach or a cyber attack may adversely affect our business, results of operations and financial condition.
  • Our defined benefit plan costs and those of AHM and HCI may affect our financial condition, cash flows, and results of operations.
  • Vehicle recalls and other announcements may impact our business
Management Discussion
  • Our consolidated income before income taxes was $719 million during the third quarter of fiscal year 2021 compared to $401 million during the same period in fiscal year 2020. This increase of $318 million, or 79%, was due to the following differences:
  • Our consolidated income before income taxes was $2,063 million during the first nine months of fiscal year 2021 compared to $1,361 million during the same period in fiscal year 2020. This increase of $702 million, or 52%, was due to the following differences:
  • Revenue from retail loans in the United States segment decreased by $13 million, or 3%, during the third quarter of fiscal year 2021 compared to the same period in fiscal year 2020. The decrease in revenue was primarily attributable to lower yields due to the declining interest rate environment. Revenue from retail loans in the Canada segment decreased by $2 million, or 4%, during the third quarter of fiscal year 2021 compared to the same period in fiscal year 2020. The decrease in revenue was primarily due to lower yields.
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New words: CAA, California, expanding, factor, fall, Georgia, January, jurisdictional, located, mix, November, regional, scope, serve, titled

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