Japanese carmaker Nissan Motor Co. Ltd. on May 14 said fiscal-year 2017 earnings increased 15.1% year over year, boosted by the benefits of tax reform in the U.S. It forecast lower profit in the fiscal year to March 2019 due to higher costs and unfavorable foreign-exchange rates.
The company reported that basic and diluted earnings per share in the 12 months to March 31 accelerated to ¥190.96 from ¥165.94 in the same period a year ago, outpacing a mean consensus of analysts' estimates for normalized EPS of ¥184.41, according to data compiled by S&P Capital IQ.
Net income attributable to owners of the parent jumped 12.6% year over year to ¥746.90 billion from ¥663.50 billion as sales ticked up 2% to ¥11.951 trillion from ¥11.720 trillion.
Operating income fell 22.6% to ¥574.76 billion from ¥742.23 billion due to vehicle inspection issues at plants in Japan, an increase in sales and marketing expenses, including dealer inventory adjustment in the U.S., and increases in raw material costs despite savings initiatives.
Nissan sold 5.77 million vehicles worldwide in the fiscal year, a 2.6% year-over-year increase.
Group sales gained 0.7% in the U.S. to 1.59 million vehicles due to demand for the Rogue and Rogue Sport models. In China, sales increased 0.6% to 1.52 million vehicles due to the performance of the X-Trail and Sylphy. The Note e-Power, Serena e-Power, Nissan Leaf, Dayz and Dayz Roox fueled a 4.8% improvement in sales in Japan, where the company sold 584,000 vehicles.
In Europe, sales declined 4.6% to 652,000 vehicles despite a 12% increase in volume in Russia, which accounted for 105,000 vehicles.
In the fiscal year ending March 2019, Nissan expects sales to expand 2.7% year over year to 5.93 million vehicles, aided by contributions from the Serena e-Power, the new Nissan Leaf, the Datsun Cross and the Infiniti QX50, but it forecast revenue would edge up just 0.4% to ¥12 trillion.
It projected net income in the fiscal year to March 2019 would fall by 33.1% year over year to ¥500 billion and operating income would shrink to ¥540 billion.
Nissan said the positive impact of the improvement in revenue and cost performance and the absence of expenses from the vehicle inspection issue would be mitigated by unfavorable foreign currency moves, higher research and development investment, high raw material costs and other factors.
As of May 14, US$1 was equivalent to ¥109.61.
