Japan's third-largest automaker Honda Motor on Monday said its net profit for the April-June quarter fell nearly 90 percent on the strong yen and the impact of the March disasters on production and sales.

However, it raised its forecasts for the full year from earlier estimates in reflection of a faster-than-expected recovery of parts supplies that were heavily disrupted by the March 11 earthquake and tsunami.

The maker of the Civic and Accord said net profit for the fiscal first quarter ended June 30 plunged 88.3 percent to 31.7 billion yen ($394 million).

Net sales fell 27.4 percent to 1.7 trillion yen compared to the same period last year, while operating profit tumbled 90.4 percent on-year to 22.5 billion yen.

The slump was "mainly caused by the impact of the Great East Japan Earthquake... and the unfavourable foreign currency translation effects," Honda said in a statement.

Honda profits have been hit by a loss in production, decreased sales and restoration costs, effects that have been compounded by the rise of the yen against the dollar and euro as well as higher raw material costs.

A strong yen makes it more expensive for Japan's automakers to domestically produce vehicles for sale overseas, while earnings earned abroad are eroded when repatriated.

The unit is currently trading in the top end of the 77 yen to the dollar range, near its postwar high of 76.25 yen struck in March.

However, Honda raised its net profit forecast to 230 billion yen this financial year from a June estimate of 195 billion yen, although the latest figure represented a 56.9 percent drop from the year-earlier profit.

Annual operating profit was expected to slide 52.6 percent on-year to 270 billion yen, better than a June forecast of 200 billion yen. Global sales are now expected fall 2.7 percent on-year to hit 8.7 trillion yen, instead of the 8.3 trillion yen forecast in June.

Honda is the second of Japan's big-three automakers to report April-June quarter earnings, after Nissan said last week net profit in the period fell by 20.3 percent on-year to 85 billion yen.

Japan's biggest automaker Toyota reports earnings Tuesday.

The 9.0-magnitude earthquake and tsunami on March 11 destroyed entire towns, left more than 20,000 dead or missing and crippled power-generating facilities, including a nuclear power plant at the centre of an ongoing crisis.

Japanese firms were hit hard by power and chronic parts supply shortages, with the likes of Nissan, Toyota and Honda having to sharply cut production and shut plants due to a lack of crucial components.

Honda's recovery has been slower than its peers, seeing June production decline 44.5 percent on-year compared to a 7.9 percent fall for Toyota and growth of 18.5 percent for Nissan.

Japan's automakers are ramping up their hiring of temporary workers to help catch up with demand as supply chains recover.

Toyota has said it plans to hire up to 4,000 contract workers, while Honda has said it needs to hire up 3,000, according to Dow Jones Newswires.

Honda shares closed up 1.46 percent at 3,125 yen in Tokyo Monday ahead of the announcement.

Separately, Mitsubishi Motors on Monday said it returned to profit for the three months to June and upgraded its interim forecast amid strong emerging market sales.

The maker of the i-MiEV electric car reported a net profit of 4.3 billion yen the April-June quarter, reversing a net loss of 11.8 billion yen in the same period last year.

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