Nissan Reports Results for Fiscal Year
19 May 2000
Nissan Reports an Operating Profit of 82.6 Billion Yen, A Net Loss of 684.4 Billion Yen for Fiscal Year 1999 Ended March 31, 2000 And Forecasts a Net Profit of 60 Billion Yen in Fiscal Year 2000
TOKYO, May 19 Nissan Motor Co., Ltd. announced financial results for the
fiscal year ended March 31, 2000.
The company reported a consolidated operating profit of 82.6 billion Yen
($ 778.9 million, Euro 809.5 million) with net sales of 5,977.1 billion Yen
($ 56.39 billion, Euro 58.60 billion), which decreased 9.2% compared to the
previous year and 10.5% on a consistent basis. Consolidated operating income
was 1.4% of net sales on a consistent basis compared to 1.8% in fiscal year
1998 because of the impact of adverse changes in foreign exchange rates. The
average exchange rate for the dollar came to 112 Yen in fiscal year 1999
compared to 128 Yen in fiscal year 1998.
The company announced one-time extraordinary charges totaling 711.1 billion
Yen ($ 6.71 billion, Euro 6.97 billion) leading to a consolidated net loss of
684.4 billion Yen ($ 6.46 billion, Euro 6.71 billion).
The results published today close a year of transition for Nissan. After
the conclusion of an alliance with Renault in March 1999, Nissan announced a
comprehensive revival plan in October 1999. With the necessary and expected
clarification contained in the provisions reported below, Nissan is today on a
fast track to returning to lasting profitable growth.
Consolidated Financial Results:
1. Unit Sales
Nissan's global vehicle sales of passenger cars and light commercial
vehicles for the full year 1999 reached 2,415,000 units compared to
2,578,000 units on a consistent basis in fiscal year 1998. Domestic sales
totaled 758,000 units, a drop of 13.2% from the prior year (873,000 units),
sales in North America (USA and Canada) rose 11.1% to 730,000 units from
657,000 units in 1998 while Mexican unit sales were stable at 144,000 units
compared to 145,000 units in 1998. In Europe, sales decreased 8.9% to
501,000 units from 550,000 units the prior year. Other foreign markets
totaled 282,000 units, down 20.1% from fiscal year 1998 (353,000 units).
2. Net Sales
Consolidated net sales for the full year came to 5,977.1 billion Yen
($ 56.39 billion, Euro 58.60 billion), a drop of 10.5% on a consistent basis
from 1998. This fall is mainly due to the negative impact of the appreciation
of the Yen, particularly in respect to the US$ and Euro and to the decline in
total unit sales of 6.3% compared to fiscal year 1998.
3. Operating Income
Consolidated operating income decreased 31.7% on a consistent basis to
82.6 billion Yen ($ 778.9 million, Euro 809.5 million) and represented 1.4% of
sales as compared to 1.8% for fiscal year 1998. The decline in operating
income is attributable to the negative impact of the appreciation of the Yen
and to lower unit sales, in particular in the domestic market. This impact
was not fully offset by reductions in costs and selling and general
administrative expenses.
4. Ordinary Income
Consolidated ordinary income came to a loss of 1.6 billion Yen
($ 15.5 million, Euro 16.1 million) compared to a profit of 30.1 billion Yen
($ 284.0 million, Euro 295.1 million) on a consistent basis in the prior year.
This loss is the result of lower operating profits despite lower non-operating
expenses such as interest on outstanding debt as a result of lower net
automotive indebtedness.
5. Income before income taxes
Consolidated income before taxes reached a loss of 712.7 billion Yen
($ 6.72 billion, Euro 6.99 billion) compared to a loss of 59.6 billion Yen
($ 562.3 million, Euro 584.3 million) on a consistent basis in 1998. This
loss is the result of extraordinary non-recurring charges of 711.1 billion Yen
($ 6.71 billion, Euro 6.97 billion) relating to the following items:
i) change in the accounting of pensions and retirement benefits reserve
to cover service of all past retirement liabilities: 275.9 billion Yen
ii) plant closures and expenses related to the Nissan Revival plan:
232.7 billion Yen.
iii) new accounting methods including a change in the calculation of
provisions relating to product warranties to bring the accounts in
line with internationally accepted accounting practices, booking
R & D expenses directly to the income statement which were
previously amortized as well as provisions resulting form the change
in the residual value of fixed assets in view of changing the
depreciation method of plant, property and equipment in Japan from
the declining balance to the straight line method to bring accounts
in line with internationally accepted practices: 114.2 billion Yen
iv) other provisions relating the values of real estate holdings and
losses on investments: 88.3 billion Yen.
6. Income taxes
The company adopted tax effect accounting starting in the current
reporting period. This change resulted in the recognition of 30.6 billion Yen
($ 288.6 million, Euro 299.9 million) of deferred tax benefits. The majority
of the tax benefits have been deferred to future years. Current income taxes
amounted to 40.5 billion Yen ($ 382.1 million, Euro 397.1 million) giving a
net tax impact of 9.9 billion Yen ($ 93.5 million, Euro 97.2 million) for the
period compared to a charge of 26.1 billion Yen ($ 246.1 million,
Euro 255.7 million) in 1998.
7. Net income
Consolidated net loss after tax reached 684.4 billion Yen
($ 6.46 billion, Euro 6.71 billion) compared to a loss of 28.5 billion Yen
($ 268.9 million, Euro 279.4 million) for the full year 1998 on a consistent
basis.
8. Indebtedness and Financial Condition
Consolidated net financial indebtedness totaled 2,481.5 billion Yen
($ 23.41 billion, Euro 24.33 billion) at the end of the fiscal year.
Consolidated net financial indebtedness of the automotive business reached
1,348.7 billion Yen ($ 12.72 billion, Euro 13.22 billion), down from
2,040.9 billion Yen ($ 19.25 billion, Euro 20.01 billion) on a consistent
basis from the end of fiscal year 1998. The net financial indebtedness of the
sales finance companies reached 1,132.8 billion Yen ($ 10.69 billion,
Euro 11.11 billion). The decrease in total consolidated net financial
indebtedness in fiscal year 1999 compared to fiscal year 1998 is due primarily
to the capital injection of Renault, while a foreign exchange translation of
82.3 billion yen ($ 776 million, Euro 807 million) and other operating factors
contributed to the drop.
Consolidated shareholder's equity at the end of March 2000 totaled
929.4 billion Yen ($ 8.77 billion, Euro 9.11 billion), a decrease of
175.3 billion Yen ($ 1.65 billion, Euro 1.72 billion) compared to
1,104.7 billion Yen ($ 10.42 billion, Euro 10.83 billion) at the end of 1998
on a consistent basis.
9. Outlook
The outlook for fiscal year 2000 contains a number of economic and market
risks. In Japan, while overall economic activity may have stabilized, total
demand for passenger cars and light commercial vehicles remains weak.
Furthermore, the Yen and Pound Sterling may continue their adverse rise
compared to the Euro thereby exerting downward pressure on operating margins.
Finally, interest rates, which are rising in Europe and the United States, may
begin to follow the same pattern in Japan.
However, there are numerous opportunities for the new fiscal year. The
Nissan Revival Plan which is now fully deployed in the company is having a
faster and deeper impact than planned. Nissan will also further leverage the
Alliance with Renault in the areas of purchasing, platform co-development and
international growth. Finally, the dollar's level versus the Yen has been so
far above fiscal year 2000's business plan assumption.
Nissan's financial forecast for the year shows an operating profit of
110 billion Yen, an ordinary profit of 40 billion Yen and a net profit of
60 billion Yen.
"We made three commitments when we announced the Nissan Revival Plan,"
said Carlos Ghosn, Chief Operating Officer, Nissan Motor Company Ltd.
"Returning Nissan to net profit after a long period of unprofitable years was
the most crucial one. In fiscal year 2000, Nissan will deliver on this first
commitment and will be on track to deliver on the two remaining commitments."
Note: Amounts expressed in US$ and Euro in this press release have been
translated for convenience only at 106 Yen = 1 US$ and 102 Yen = 1 Euro, the
approximate rate of exchange on March 31, 2000.
Fiscal year 1998 figures have been restated in order to account for the
change in the company's scope of consolidation. For the sake of consistency,
when comparisons to fiscal year 1999 are made, the restated fiscal year 1998
numbers are used.
CONSOLIDATED FINANCIAL RESULTS
(For the fiscal years ended March 31, 2000 and 1999)
FY ended March 31 FY ended March 31
(millions of yen) 2000 1999 Change (%)
Net sales 5,977,075 6,580,001 -9.2
Operating income 82,565 109,722 -24.8
Ordinary income -1,642 24,463 ---
Net income -684,363 -27,714 ---
Net income per share (yen) -179.98 -11.03 ---
Fully diluted net
income per share (yen) --- --- ---
Ratio of net income
to equity (%) -62.7 -2.2 ---
Return on assets (%) --- 0.3 ---
Return on sales(%) --- 0.4 ---
FINANCIAL CONDITION
March 31 March 31
2000 1999
Total assets (millions of yen) 6,541,184 6,917,561
Shareholders' equity (millions of yen) 929,356 1,254,595
Equity ratio (%) 14.2 18.2
Shareholders' equity per share (yen) 236.71 499.24
SEGMENT INFORMATION
(For the fiscal years ended March 31, 2000)
(millions of yen)
Net Sales Operating income Assets
Japan 2,626,866 19,430 5,288,346
North America 2,217,775 87,340 1,674,905
Europe 876,931 -38,112 405,638
Others 255,503 -3,086 70,420
Sub-total 5,977,075 65,572 7,439,309
Adjustment --- 16,993 -898,125
Total 5,977,075 82,565 6,541,184
FORECAST OF CONSOLIDATED FISCAL YEAR ENDING MARCH 31, 2001
(millions of yen) March 31, 2001
Net sales 6,100,000
Ordinary income 40,000
Net income 60,000
APPLICATION OF CONSOLIDATION AND THE EQUITY METHOD
The number of consolidated subsidiaries: 342
JATCO Trans Technology Ltd.
Nissan Shatai Co., Ltd.
Yokohama Nissan Motor Co., Ltd.
Nissan North America, Inc.
Nissan Europe N.V.
Nissan Mexicana, S.A. de C.V.
and other 336 companies
The number of affiliates consolidated by the equity method: 73
Nissan Diesel Motor Co., Ltd.
Calsonic Corporation
Kansei Corporation
Yulon Motor Co., Ltd.
Siam Nissan Automobile Co., Ltd.
and other 68 companies
Companies newly consolidated in last fiscal year ended
March 31, 2000: 157
Nissan Shatai Co., Ltd.
Aichi Machine Industry Co.,Ltd.
and other 155 companies
Companies excluded from consolidation in last fiscal year: 18
Sendai Nissan Motor Co., Ltd.
Nissan Finance (GB) Ltd.
and other 16 companies
Companies newly consolidated by the equity method in last fiscal year: 21
Osaka Nissan Co., Ltd.
and other 20 company
Companies excluded from consolidation by the equity method in last fiscal
year: 49
Nissan Shatai Co., Ltd.
Aichi Machine Industry Co.,Ltd.
Tokyo Nissan Auto Sales Co.,Ltd
TU-KA cellular Tokyo Inc. and TU-KA group 8 companies
and other 37 companies
NON-CONSOLIDATED FINANCIAL RESULTS
(For the fiscal years ended March 31, 2000 and 1999)
FY ended FY ended
March 31 March 31
(millions of yen) 2000 1999 Change (%)
Net sales 2,997,020 3,319,659 -9.7%
Operating income -15,674 15,165 ---
Ordinary income -35,850 14,646 ---
Net income -790,064 -34,809 ---
Net income per share (yen) -204.93 -13.85 ---
Fully diluted net income
per share (yen) --- --- ---
Ratio of net income
to equity (%) -57.7 -2.3 ---
Return on assets (%) -1.0 0.4 ---
Return on sales (%) -1.2 0.4 ---
(1)Computed based on the following average number of shares of common
stock outstanding during fiscal years ended March 31, 2000 and 1999:
March 31, 2000 ---3,855,272,918
March 31, 1999 ---2,513,043,751
(2)There is a change of accounting method.
(3) "Change(%)" means the rate of decrease on Net sales from the previous
year.
DIVIDENDS FY ended March 31 FY ended March 31
2000 1999
Cash dividends per share (yen)
Interim 0.00 0.00
Year-end 0.00 0.00
Cash dividends applicable to the year
(millions of yen) 0 0
Payout ratio (%) 0.0 0.0
Ratio of dividends paid to equity (%) 0.0 0.0
FINANCIAL CONDITION
March 31 March 31
2000 1999
Total assets (millions of yen) 3,563,853 3,595,272
Shareholders' equity (millions of yen) 1,263,075 1,477,498
Equity ratio (%) 35.4% 41.1%
Shareholders' equity per share (yen)* 317.57 587.93
* Computed based on the following number of shares of common stock
outstanding as of March 31, 2000 and 1999:
March 31, 2000 --- 3,977,293,751
March 31, 1999 --- 2,513,043,751
VEHICLE PRODUCTION
(For the fiscal years ended March 31, 2000 and 1999)
FY ended March 31 FY ended March 31
2000 1999 Change (%)
Worldwide production (units) 2,404,650 2,465,863 -2.5%
Domestic 1,336,918 1,528,461 -12.5%
Overseas 1,067,732 937,402 13.9%
NON-CONSOLIDATED SALES BY PRODUCT LINE
(For the fiscal years ended March 31, 2000 and 1999)
FY ended FY ended
March 31 March 31
2000 1999 Change (%)
Vehicle sales (units)
Total vehicle sales 1,356,575 1,584,550 -14.4%
Domestic 744,585 873,705 -14.8%
Export 611,990 710,845 -13.9%
Passenger cars 1,159,290 1,355,082 -14.4%
Domestic 639,116 768,277 -16.8%
Export 520,174 586,805 -11.4%
Commercial vehicles 197,285 229,468 -14.0%
Domestic 105,469 105,428 0.0%
Export 91,816 124,040 -26.0%
Net sales (millions of yen)
Total net sales 2,997,020 3,319,659 -9.7%
Domestic 1,546,744 1,722,093 -10.2%
Export 1,450,275 1,597,565 -9.2%
Vehicles 2,309,154 2,616,537 -11.7%
Domestic 1,272,519 1,418,404 -10.3%
Export 1,036,634 1,198,132 -13.5%
Production parts & components
for overseas production 246,628 221,383 11.4%
Domestic --- ---
Export 246,628 221,383 11.4%
Automotive parts 301,382 330,169 -8.7%
Domestic 210,889 232,494 -9.3%
Export 90,493 97,674 -7.4%
Forklifts & marine equipment 39,751 44,057 -9.8%
Domestic 15,183 16,906 -10.2%
Export 24,568 27,151 -9.5%
Aerospace equipment 45,911 51,157 -10.3%
Domestic 45,911 51,157 -10.3%
Export --- --- ---