Nissan Earnings Update
TOKYO, Feb. 8 (Kyodo) — Nissan Motor Co. said Friday its group net profit dropped 12.7 percent from a year earlier to 232.39 billion yen in the April to December period, due to sluggish sales in China in the wake of anti-Japanese protests in the country as well a drop in sales in Europe amid the eurozone debt crisis.
The automaker booked a consolidated operating profit of 349.19 billion yen, down 18.4 percent, also due to fierce competition in the North American market. Sales rose 0.8 percent to 6.76 trillion yen.
By volume, global auto sales in the nine-month period increased 6.0 percent from the year before to 3.64 million vehicles, despite a 6.7 percent drop in sales in Europe to 479,000 units.
In the October-December period, global sales dropped 3.8 percent to 1.16 million vehicles, with sales in Europe declining 13.5 percent to 151,000 units.
Nissan, which has high exposure to China, said its sales there in the January-to-September period rose 4.5 percent to 947,000 vehicles, but plunged 31.2 percent to 234,000 vehicles in the three-month period through December following the massive anti-Japan protests that erupted in September across China.
"We faced unfavorable conditions including negative growth in Europe, slowing growth in the Chinese market and deteriorating Japan-China relations in the third quarter," Corporate Vice President Joji Tagawa said at a press conference.
Although some signs of recovery are seen in China, "We still can't say sales there have fully returned to normal," he said.
While noting the recent weakening of the yen is expected to have a positive impact on earnings down the road, Nissan kept intact its full-year earnings projection for the business year ending in March, citing intensifying price competition and dim prospects for a quick recovery in sales in China and Europe.
The company expects to post a group net profit of 320 billion yen, down 6.3 percent, and a consolidated operating profit of 575 billion yen, up 5.3 percent, on sales of 9.82 trillion yen, up 4.3 percent.
The recent depreciation of the yen against the U.S. dollar and the euro prompted some other Japanese automakers including Toyota Motor Corp. to revise upward their full-year earnings projections. Toyota foresees a group operating profit of 1.15 trillion yen, up 100 billion yen from its previous estimate.