Japan Press Weekly

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2009 April 29 - May 12 [LABOR]

Honda saves more than 5 trillion yen in internal reserves while simultaneously dismissing all fixed-term contract workers

Japan’s major automaker Honda Motor Co., Ltd. had 5 trillion yen in its internal reserves as of the end of March, but dismissed all fixed-term contract workers at the end of April.

In its consolidated earnings report for the year ending in March, which was announced on April 28, Honda had a net income of 137 billion yen, even though its sales declined from the previous year.

The automaker also holds about 5.9 trillion yen in internal reserves which remains at almost the same level as last year.

Honda paid shareholders 63 yen per share in dividends. The total amount of dividends paid reached 114.3 billion yen. The dividends payout ratio, the percentage of earnings paid to shareholders in dividends, jumped to 83.4 percent.

This shows that Honda cares more for dividends to shareholders than maintaining employment at a time when its profit is decreasing.