Nissan’s quarterly profit drops 70%

Nissan Motor reported a 70% profit drop on Tuesday and cut its full-year outlook to an 11-year low, as the Japanese automaker was hit by falling sales that highlight its ongoing turmoil after the ouster of former head Carlos Ghosn.

The latest weak showing from Nissan, already battered by weak financial performance for nearly two years, illustrates the scale of the work ahead for its new executive team, which is due to take over on Dec.1. Following the ouster of Ghosn almost a year ago, Nissan has been hit by sliding profit, uncertainty over its future leadership and tensions with top shareholder Renault - whose shares fell 2% to their lowest since April 2013 after Nissan’s disappointing guidance.

Operating profit at Japan’s second-biggest automaker by sales came in at 30 billion yen ($274.98 million) during the July-September period versus 101.2 billion yen a year earlier.

That compared with a mean forecast of 47.48 billion yen from nine analyst estimates compiled by Refinitiv, and marked its worst second-quarter performance in a decade and a half. “Operating profit for the first half is off our target” for full-year profit, Stephen Ma, a corporate vice president and the incoming chief financial officer, told reporters. “We are revisiting all our assumptions, and as you can see that is why we revised down our forecast for sales volume for the full year.”

Nissan slashed its full-year operating profit forecast by 35% to 150 billion yen. That would mark its worst full-year performance in 11 years. It now sees global retail sales at 5.2 million vehicles, from 5.5 million previously.

The automaker in the past few weeks has announced a revamp of its top ranks with younger executives, naming the head of its China business, 53-year-old Makoto Uchida, as its next chief executive, as it seeks to draw a line under Ghosn’s legacy.

Reuters