Motor Co. Ltd. reports a smaller-than-expected 4.9% drop in third-quarter operating profits Oct. 26, but retains its full-year forecasts that have been helped by a softer yen.
July-September operating profit fell to Y195.3 billion ($1.65 billion), beating an average projection of Y189.15 billion ($1.59 billion) in a Reuters Estimates survey of five brokerages. Revenue fell 0.9% to Y2.32 trillion ($19.54 billion).
Net profit grew 31%, helped by gains from selling shares inDiesel Motor Co. to as well as favorable pension and tax benefits.
After straining to meet a 3.6 million-vehicle global sales target for the 12 months through September 2005, Nissan’s slump has been exacerbated by an aging vehicle line.
Chief Executive Carlos Ghosn last year predicted the effect of a final sprint toward the sales goal would be short-lived, but has since called for a reversal only in the current half-year, with Nissan planning to flood the global market with nine all-new models. Ghosn says Nissan U.S. sales are on track to grow by a double-digit percentage in October.
Ward’s data show Nissan could see a jump of 11.6% this month vs. year-ago.
Related document: Ward's U.S. Light Vehicle Sales & Inventory Forecast, October 2006
Ghosn also is CEO ofAG, which owns a 44% stake in Nissan and was interested in forming an alliance with Corp. Nearly three months of talks failed after GM’s board sided with senior management and voted against a linkup.
GM reported Oct. 25 a third-quarter loss of $115 million. But excluding one-time charges of $644 million, the auto maker reported a $529 million operating profit – better than analysts expected.
Nissan is expected to be Japan's only leading auto maker to post lower second-quarter earnings. RivalMotor Co. Ltd. says its operating profit in the period jumped 19% as sales powered ahead in North America.