Honda Motor Co <7267.T> posted a 90 percent fall in quarterly operating profit as a severe parts shortage stemming from the March 11 earthquake slashed output, but avoided an expected loss and raised its annual profit guidance by more than a third.

Honda suffered the biggest drop in production of any carmaker from the March disaster due mainly to bad timing for the scheduled delivery of parts. The supply shortage coincided with the full remodeling this spring of its Civic model in the key U.S. market, where sales of the popular car fell by a third in June.

Honda's Japanese production halved in June from the previous year, even as Nissan Motor Co <7201.T> eked out a rise and the decline at Toyota Motor Corp <7203.T> shrank to 16 percent, from 78 percent in April.

Honda, Japan's No.3 automaker, said on Monday it made an operating profit of 22.58 billion yen ($292.5 million) in the April-June quarter, compared to a 234.4 billion yen profit a year earlier. The result was much better than the average estimate of a 67 billion yen loss in a survey of seven analysts by Thomson Reuters I/B/E/S.

It posted a net profit of 31.8 billion yen, down 88 percent from the previous year, while revenue fell 27 percent to 1.715 trillion yen.

For the full year to March 2012, the maker of Civic and Accord cars now expects operating profit, which excludes earnings from China, of 270 billion yen, or 35 percent more than the previous forecast of 200 billion yen. A poll of 21 analysts produced a forecast of 407.7 billion yen.

Honda raised its annual net profit forecast to 230 billion yen from 195 billion yen.

A further strengthening in the yen has added to Honda's woes, while surging raw materials prices and escalating fears over the health of the global economy weigh on the overall industry.

Still, with full restoration of the supply chain only a matter of time, Honda has suggested it will ramp up production in the second half and analysts said it could easily overshoot its guidance.

Shares in Honda are down 4 percent in the year to date, underperforming a 1 percent drop in Tokyo's transport sector subindex <.ITEQP.T>.

Before the results were announced, Honda ended up 1.5 percent at 3,125 yen, outperforming the benchmark Nikkei average <.N225.> and a rise in most other auto stocks. ($1 = 77.190 Japanese Yen)

(Reporting by Chang-Ran Kim; Editing by Matt Driskill)