Nissan Motor Co Limited announces its financial results for the first half year with revenue and net income both down.

Nissan Motor Co., Ltd. today announced financial results for the six-month period to September 30, 2016.

"In the first half, Nissan generated a solid operating profit of 339.7 billion yen, which represents a 6.4 percent margin on net revenues of 5.32 trillion yen," said Carlos Ghosn, Chairman and Chief Executive Officer. "These solid results were achieved despite recent currency headwinds and continued challenges in Japan and emerging-markets."

Fiscal Year 2016 First Half Financial Highlights

The following table summarizes Nissan's financial results for the six-month period to September 30, 2016, calculated under the equity accounting method for the Group's China joint venture.

Fiscal Year 2016 First Half Financial Highlights to September 30, 2016

(TSE report basis – China JV equity basis)¹

Yen in billions	FY H1 15	FY H1 16	% change year on year	FY H1 16 at constant currency	% change at constant currency
Revenues	5,933.3	5,321.0	-10.3	6,123.4	+3.2
Operating profit	395.0	339.7	-14.0	519.5	+31.5
Operating margin %	6.7	6.4	-0.3	8.5	+1.8
Ordinary profit	427.7	396.8	-7.2	N/A	N/A
Net income2	325.6	282.4	-13.3	N/A	N/A
Based on average foreign exchange rates of JPY 105.2/USD and JPY 118.0/EUR

On a constant currency basis, operating profit rose 31.5 percent to 519.5 billion yen, equivalent to an 8.5 percent profit margin. This reflects demand for core products, particularly in North America and benefits of continued cost-discipline, on-going product introductions and Alliance strategy.

On a management pro forma basis, which includes the business results of Nissan's operations in China, FY16 first half net revenue decreased 9.6 percent to 5.84 trillion yen. Operating profit fell 10.7 percent versus the same period last year, to 412.0 billion yen. The operating profit margin fell from 7.2 percent to 7.1 percent.

On a constant currency exchange rate basis, pro-forma net revenues increased 4.2 percent to 6.73 trillion yen and operating profit improved 30.6 percent to 603.0 billion yen, equivalent to a profit margin of 9.0 percent.

Sales performance

In the first half of the fiscal year, Nissan's total unit sales were 2.61 million units.

In the U.S., Nissan's sales rose by 3.7 percent to 783,000 units, equivalent to a market share of 8.7 percent, amid strong demand for the Altima, the Rogue and the Maxima.

Nissan unit sales in China, which reports figures on a calendar year basis, rose 3.8 percent to 610,000 units, equivalent to market share of 5.0 percent. In Europe, excluding Russia, Nissan's sales rose by 4.4 percent to 319,000, which resulted in a market share of 3.6 percent. The Qashqai SUV and X-Trail helped drive demand in the region.

Nissan's performance in these key markets helped compensate for a decline in the Japanese market where Nissan was impacted by the suspension of Dayz/Dayz Roox minicar sales. Total unit sales in the quarter for Japan were 211,000 units, representing a market share of 9.2 percent. In other markets including Asia and Oceania, Latin America, the Middle East and Africa, Nissan's sales decreased 4.9 percent to 382,000 units.

Outlook

"Nissan is maintaining its global sales and earnings forecast for fiscal 2016," said Mr. Ghosn. "Although Nissan faces market uncertainty and currency headwinds, we expect to continue to deliver solid earnings and positive free cash flow generation in the current fiscal year. We can also look forward in fiscal year 2017 to valuable synergies from our alliance with Mitsubishi Motors, in which we recently acquired a 34 percent stake."

"As announced at the end of the last fiscal year, we have decided to increase the full year dividend by 14.3 percent to 48 yen per share, and the Board today approved an interim dividend payment of 24 yen per share."

The Company expects to sell 5.6 million units this fiscal year, up 3.3 percent. Based on this sales outlook, Nissan has maintained forecasts first issued to the Tokyo Stock Exchange in May 2016. Calculated under the equity accounting method for the fiscal year ending March 31, 2017, the forecasts showed:

Nissan FY16 Outlook – TSE report basis – China JV equity basis1
Net revenue	¥11.8 trillion
Operating profit	¥710.0 billion
Ordinary profit	¥800.0 billion
Net Income2	¥525.0 billion

1 Since the beginning of fiscal year 2013, Nissan has reported figures calculated under the equity method accounting for its joint venture with Dong Feng in China. Although net income reporting remains unchanged under this accounting method, the equity-accounting income statements no longer include Dong-Feng-Nissan's results in revenues and operating profit.

2 Net income attributable to owners of the parent