Nissan Motor Co., Japans second-biggest car manufacturer, posted Q2 earnings today, revealing a sizable increase for both revenue and profit, boosted by rising sales in the US and China.
Nissan, whose assets are valued at about $144 billion, said its net profit for Q2 of 2014 was up 37% on an annual basis at $1.1 billion, while revenue rose 11% to about $25 billion, with worldwide sales rising 6% to 1.24 million units.
Sales in Asia added 19.1%, while North America saw a 10.4% increase, 14.1% in the US, boosted by a weakened yen. Domestic sales, however, were down 2.7%, weighed on by a higher sales tax, which was increased from 5% to 8% earlier this year.
“Nissan is well placed to deliver on its outlook given our continued offensive along with measures to enhance competitiveness, build market share and the ongoing benefits of our alliance strategy,” Renault-Nissan Alliance CEO Carlos Ghosn said in a statement. As of 2013, Renault holds a 43.4% voting stake in Nissan, while Nissan holds a 15% non-voting stake in Renault. Mr Ghosn serves as CEO for both companies.
Nissan also reaffirmed its annual operating profit forecast of 535 billion yen ($5.3 billion) for the financial year ending in March 2015, while revenue is projected to rise 3% to 10.79 trillion yen ($100.59 billion), with a global market share of 6.7%.
The report comes after last week Nissan announced it is recalling 226 000 more vehicles, in relation with a defective airbag, including models of Infiniti, Maxima, Pathfinder and Sentra for the years 2002 to 2004. Brian Brockman, spokesman for Nissan, said the company isnt aware of any accidents or injuries related to the recall. The recall is expected to begin 11 August.
Meanwhile, Nissan announced the strengthening of another strategic partnership last week, revealing a joint venture with Daimler in Mexico. A manufacturing plant with an output capacity of about 300 000 Mercedes-Benz and Infiniti compact cars will open by 2017, in a move which Daimler CEO Dieter Zetsche said would “take [this] successful partnership to the next level”. Daimler has been in a partnership with Renault and Nissan since 2010.
Before the earnings report was posted, Nissan Motor Co. was up 0.82% as trading in Japan closed on Monday, for a share price of 1 001.5 yen, or about $9.83. The price was 8.71% lower than a year ago. According to the Financial Times, 22 analysts offering 12 month price targets for Nissan Motor Co Ltd have a median target of 1 050 yen, with a high estimate of 1 300 yen and a low estimate of 970 yen. The median estimate represents a 4.62% increase from the last price of 993.40 yen.
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