Nissan returns to quarterly profit on China sales

TOMOKO A. HOSAKA Comments 0
Published: November 4, 2009

TOKYO (AP) — Struggling Japanese automaker Nissan Motor Co. said Wednesday it climbed back into the black in the latest quarter and predicted a smaller yearly loss thanks to recovering demand for its cars in China and other markets.

The country's No. 3 car company posted net income of 25.5 billion yen ($270 million) in the July-September period after three straight quarters in the red. The result is 65 percent lower than last year but far better than its 16.5 billion yen loss in the April-June quarter.

Sales totaled 1.87 trillion yen ($19.57 billion), and operating profit came to 83.3 billion yen ($870 million). The automaker sold 901,000 vehicles in the quarter, down 6.8 percent from the previous year.

Sales growth in China contributed to the better-than-expected result, the company said.

"Our performance in the first half of fiscal 2009 is encouraging, demonstrating that Nissan's recovery plan is on track," President and CEO Carlos Ghosn said in a statement. "Our outlook will remain cautious until we see evidence that economic recovery can be sustained in world markets."

Nissan lifted its estimates for the full fiscal year through March 2010.

It now projects a narrower net loss of 40 billion yen compared with its previous estimate of a 170 billion yen loss. It expects revenue of 7 trillion yen and an operating profit of 120 billion yen instead of an operating loss of 100 billion yen.

A new report Tuesday showed that after months of volatility, the American auto market appeared to stabilize in October. Total U.S. sales of cars and light trucks rose 12 percent from a dismal September 2009, though were little changed compared to a year ago, according to Autodata Corp.

Nissan was one of the biggest winners of the month, posting a 5.6 percent gain in auto sales. Demand for Nissan models offset falling sales of its Infiniti model, the carmaker said.