Nissan Motor has posted quarterly operating profit (Q1 fiscal year, period ended June 30) of 109.1bn yen, some 29% down on last year. Revenues for the quarter were down 1.6% at 2.72 trillion yen and Nissan total vehicle sales decreased 3% to 1.31m units (down in North America and Europe, up in China, Middle East and Latin America).
Nissan said profitability in the period was largely impacted by rising raw material costs and foreign exchange movements.
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The company has also been hit by the negative impact caused by a decline in unit sales in the US (Nissan’s quarterly sales in US declined year-on-year by 9.5% to 365,000 units). Nissan said it continues to work on normalising US sales and improving dealer inventory levels. In the months ahead, the new Infiniti QX50 and Kicks will enhance the model cycle, it says, along with the new Altima, which will go on sale in autumn.
In Europe, including Russia, Nissan’s quarterly sales totalled 162,000 units, a decrease of 12.7%. Excluding Russia, Nissan’s sales decreased 14.4% to 139,000 units, representing a market share of 2.9%. Nissan said the decline is primarily due to the decline in sales volume in the UK, where Nissan has a strong presence, and the ‘focus on profitability including the reduction of fleet sales’.
In Japan, Nissan’s sales fell by 0.8% to 130,000 units. The total industry volume fell by 1.0% to 1.19 million units compared to the previous year, resulting in Nissan’s market share remaining flat at 10.9%.
In China, where Nissan reports figures on a calendar-year basis, unit sales increased 6.9% to 336,000 units, representing a market share of 5.0%, up 0.3 percentage point from the comparable period in the prior year. This, it said, was driven by strong demand for models including the Kicks, X-Trail, Teana and Navara, as well as Venucia-brand models such as the D60.
In other markets, including Asia and Oceania, Latin America, the Middle East and Africa, Nissan’s sales increased 6.6% to 200,000 units.
Joji Tagawa, Corporate VP said: “Our results for the quarter were unfavourable, as we faced a number of challenges, including the decline in sales in North America and Europe, an increase in commodity prices, and foreign exchange headwinds.”
Looking at the operating profit movement, Nissan said foreign exchange had a negative impact of 19.3 billion yen, and the increase in raw material prices resulted in a negative impact of 27.0 billion yen. Excluding these two external factors, our operating profit was nearly flat year-on-year, with an increase of 2.1 billion yen, the company says.
Taking volume and mix and marketing and selling expenses by region, the US was negative by 40 billion yen and other regions were positive by 23 billion yen.
Nevertheless, for the full fiscal year, Nissan said its previous guidance is unchanged and it projects a full-year dividend of 57 yen per share, a 7.5% increase from the prior year.
