Nissan quarterly profits up 15% on strong sales and weak yen

The Japanese automaker confirmed profit forecast for the full fiscal year through March 2015 at $3.6 billion

A Nissan Pulsar Nismo Concept car (AFP/Getty)

Nissan's quarterly profit jumped nearly 15 per cent to a better-than-expected 124.9 billion yen ($1.1 billion) as vehicle sales improved in almost all regions.

The Japanese automaker, behind the Leaf electric car, Altima compact and Infiniti luxury brand, stuck to its profit forecast for the full fiscal year through March 2015 at 405 billion yen ($3.6 billion).

Nissan said the perk from a weak yen and stronger sales in North America will make up for falling sales in China and other nations.

The dollar was trading at about 100 yen last fiscal year, but has been rising lately, buying about 113 yen this week. A weak yen is a boon for Japan's giant exporters such as Nissan by boosting the value of their overseas earnings.

Nissan, allied with Renault of France, said it gained 17 billion yen ($150 million) in operating profit for the fiscal first half from a favorable foreign exchange rate.

Yokohama-based Nissan revised its annual sales forecast to 5.45 million vehicles, down from an earlier 5.65 million vehicles. The lower forecast is still above the previous fiscal year at 5.19 million vehicles.

Analysts surveyed by FactSet had expected quarterly profit at about 100 billion yen ($885 million). Quarterly sales edged up 6 per cent to 2.68 trillion yen ($23.7 billion).

Car sales in Japan have languished in recent years as younger people lost interest in driving in a nation that abounds with reliable public transportation, especially in urban areas.

Sales have especially nose-dived in recent months after sales tax was raised in April. Buyers had rushed in before the hike.

But Nissan's vehicle sales for the latest quarter improved in other parts of the world including North America, Europe and Asia. During the first half of fiscal 2014, Nissan sold 2.58 million vehicles globally, a nearly 6 percent rise on year.

"Nissan successfully overcame challenging market conditions in the first half of the fiscal year," said Carlos Ghosn, president and chief executive.

"Nissan is on track to deliver its full-year net income guidance, reflecting the benefits of our continued product offensive, financial discipline and synergies from our alliance strategy."

PA