By Chang-Ran Kim, Asia auto correspondent
TOKYO, April 26 (Reuters) - Japan's Nissan Motor Co confirmed its status as the world's most profitable car maker on Monday with a 12 percent jump in annual operating profit and it forecast stable growth over the next four years.
Announcing its highly anticipated three-year business plan to begin next April, Japan's third-biggest auto maker said it would aim to boost global sales by 37 percent to 4.2 million vehicles by the 2007/08 business year as it continues to expand into untapped regions and segments.
With turnaround king Carlos Ghosn at the helm, Nissan has gone from near-bankruptcy in 1999 to a money-making machine as it slashed jobs, cut its debt, overhauled its brand image with racy new designs and rolled out dozens of cars globally.
"The new business plan commits to sustained growth, high profitability and return on investment," Nissan, owned 44 percent by France's Renault SA , said in a statement.
Under the plan, dubbed "Nissan Value-Up", the auto maker would roll out 28 all-new models and launch the Infiniti luxury brand worldwide, including in Japan and Europe.
It would also aim to keep its operating margin "at the top level" among global auto makers and its return on invested capital (ROIC), a frequently used yardstick of profitability, above 20 percent.
In the just-ended business year, Nissan had an operating margin of 11.1 percent -- the highest among mass-market auto makers and well above the eight percent promised under the current "Nissan 180" business plan. ROIC was 21.3 percent.
FURTHER GROWTH AHEAD
Kicking off the earnings season for Japan's auto industry, Nissan said operating profit came to a record 824.86 billion yen ($7.56 billion) in the year that ended on March 31, in line with analysts' consensus estimate of 830 billion yen.
A drop in the dollar's value against the yen and increased R&D and advertising costs weighed on profits, but those factors were offset by bigger sales volume and a better product mix. Net profit rose 1.7 percent to 503.67 billion yen as revenues climbed 8.8 percent to 7.429 trillion yen.
While acknowledging risks from currency swings and rising materials prices, Nissan forecast a 4.3 percent rise in operating profit to 860 billion yen this year as it continues to drive into untapped segments and markets. The profit assumes an average dollar rate of 105 yen and a euro rate of 125 yen.
A transfer of Chinese earnings to the operating level from a net basis will also lift those profits, it said.
Nissan said it aimed to sell 3.38 million vehicles worldwide in the current business year versus 3.057 million in the year that has just ended.
Nissan's bigger domestic rival, Toyota Motor Corp , is also expected to post record operating profits when it reports next month, as it expanded sales in every corner of the world amid cut-throat competition.
But the road has not been as smooth for Honda Motor Co , which is expected to report a fall in operating profit when it announces its earnings on Tuesday.
While Nissan said it had more room to grow by expanding into more geographic regions, analysts say it faces the challenge of making a smooth transition in leadership after Ghosn takes on the added role of heading partner Renault in April 2005.
The Brazilian-born Frenchman, feted for Nissan's recent success, has said he would name a Japanese chief operating officer to oversee Nissan's day-to-day operations by the end of the year.
Shares in Nissan gained 46 percent during the 12-month period, in line with the broader market's rise.
They ended up 1.43 percent at 1,278 yen on Monday before the announcement, compared with a 0.36 percent rise in the main Nikkei average . ($1=109.04 Yen)