Nissan Cuts Annual Earnings Forecast as China, U.S. Sales Cool - EcoFinBiz Blog

Blue Host

Nissan Cuts Annual Earnings Forecast as China, U.S. Sales Cool

The Smarter way to get your business news - Subscribe to BloombergQuint on WhatsApp

(Bloomberg) -- Nissan Motor Co. cut its earnings forecast for the year after third-quarter profit missed analysts’ estimates, adding to the headwinds for the carmaker grappling with the aftermath of the shock arrest of iconic ex-Chairman Carlos Ghosn.

  • Nissan is now forecasting operating profit of 450 billion yen ($4.1 billion), the lowest level in about six years and down from its previous forecast of 540 billion yen. Analysts were expecting operating profit to fall 10 percent to 517 billion yen this year.

Key Insights

  • Sales in U.S. and China are continuing to wane amid an industrywide slump, intensifying the pressures on Chief Executive Officer Hiroto Saikawa who is trying to ease tensions with partner and shareholder Renault SA following Ghosn’s arrest.
  • In the U.S., the carmaker is slowing down production to focus on profitability in America. Sales in China, Nissan’s largest market, fell in the October-December quarter.
  • Nissan kept its projected full-year dividend at 57 yen a share, a boon for shareholders including Renault, which owns 43 percent of Nissan.

Get More

  • Nissan U.S. sales plunged 19 percent in January, after slumping 6.2 percent in 2018. The U.S. market has been a major drag for Nissan in the past quarters.
  • Sales in the Japanese carmaker’s domestic unit rose about 32 percent in the December quarter, helped the previous year’s low base when shipments were hit by an inspection scandal.
  • The company booked a one-time charge of 9.2 billion yen to reflect Ghosn’s yet-to-be-paid remuneration, a point of focus for Tokyo prosecutors who have indicted him for allegedly understating his income at Nissan by tens of millions of dollars.

To contact the reporter on this story: Ma Jie in Tokyo at jma124@bloomberg.net

To contact the editors responsible for this story: Anand Krishnamoorthy at anandk@bloomberg.net, Ville Heiskanen

©2019 Bloomberg L.P.

. Read more on OnWeb by BloombergQuint.

No comments


Theme images by merrymoonmary. Powered by Blogger.