Nissan's Earnings Disappoint Across the Board, Outlook Lowered

Nissan reported a 23% drop in Q3 net income to ¥104.4 billion ($862m), or ¥25.29/share, on a 1.8% rise in sales to ¥2.34 trillion ($19.3b) -- missing analysts' average estimate of ¥153.5b ($1.27b; per Bloomberg) and 3% revenue growth (per Thomson). Nissan was hurt again by a lack of new models, in addition to facing higher raw materials and energy prices. This is Nissan's first drop in profit in six quarters. Its worldwide autos sales fell 3% in the quarter, led by a 16% decline in Europe. Nissan cut its full fiscal year (ending in March) net profit forecast by 12% to ¥460b ($3.8b). Nissan's Nasdaq listed shares will likely face selling pressure, as will its ordinary shares on Monday, considering its Deutsche Bourse listing is currently down about 4% (having traded as much as 5.5% lower). Nissan's ordinary shares lost 1.8% to ¥1,509 ($24.94 ADR equiv. at ¥121/$1) ahead of its earnings announcement.

Sources: Press release and IR materials, Bloomberg, MarketWatch
Commentary: Nissan to Tap Renault for 'Econocar' Design, But No 'Cross-badging' • Nikkei Briefly Touches 6 Year High, But Japan ADRs Lag • A "Pleasant Problem" at Toyota and Honda: Full Capacity
Stocks/ETFs to watch: Nissan (NSANY). Competitors: Toyota (TM), Honda (HMC), General Motors (GM), Ford (F), DaimlerChrysler (DCX)

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