Dismal Earnings Reports Lands, Nissan Cuts Profit Forecast Again

Nissan has handed in its third-quarter 2019 earnings report, and the grades are bad. Missing analyst expectations, the automaker’s operating profit fell 83 percent in the first 9 months of the fiscal year, with revenues down 12.5 percent. That leaves Nissan with an operating margin of 0.7 percent — down three percentage points from this time last year.

Operating profit in Q3 (October-December) was $210 million.

As the automaker attempts to triage its way out of a financial hole that deepened rapidly in early 2019, Nissan has again pared back its full-year profit forecast.

The company now expects to manage $775 million in profit in fiscal year 2019. Since the outset of the fiscal year last April, that forecast shrank from $2.09 billion to $1.4 billion, then to this.

“Despite having made steady progress in its business transformation and profit recovery measures, due to weak performance and a slowdown in total industry volume the company has revised its full-year guidance,” the automaker sail in the report.

“For the full fiscal year, the company now expects to sell 5.05 million vehicles, a decrease of 3.6% from the previous forecast in November.”

Nissan’s global sales shrunk 8.1 percent in the first nine months of the fiscal year, most dramatically in North America. In China, currently hit hard by a virus outbreak that’s idled plants and restricted consumer movement, the automaker saw just a 0.6-percent sales decrease. The final quarter of the year could look very different in that market.

Citing “the need for investment in future technologies to strengthen the company’s competitiveness,” Nissan said it would not distribute a year-end dividend.

In Beirut, a man who once devoted his life to nurturing Nissan’s financial health is likely all smiles this morning.

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