FY06 Financial Results Small Meeting€¦ · • Sale of fixed assets (Company house, NNA HQ,...

FY 2004 Third Quarter ReviewFY06 Small Meeting May 23, 20071

May 23, 2007

Joji TagawaCorporate Vice President

FY06 Financial Results Small Meeting


FY06 Sales Performance

FY06 Financial Performance

Outlook for FY07

Sales Financing

Agenda


(billion yen)

Consolidated net revenue

Consolidated operating profit

Operating margin

FY06 financial performance

Net income

FY06

10,468.6

776.9

7.4%

460.8

FOREXRate

¥117.0/$¥148.2/€


Global retail sales

0

1,500

2,000

3,000

3,500

2,500

FY01 FY02 FY03

(th

ou

san

d u

nit

s)

FY06

FY06 sales performance

FY99 FY00 FY04 FY05

3,057

3,389

2,530

3,483-2.4%

2,597

2,771

2,633

3,569

NISSAN 180NRP NISSAN Value-Up


FY2006 2nd half

G35 sedanSentraAltima

Livina GenissADOttiPino

QashqaiAtlas 20

** launch eventsworldwide

10 new models

FY2006 1st half

Cabstar

* SOS basis** Apr.-Mar. basis

New product launches FY06 sales performance

91


Retail sales: Japan

0

200

400

800

1,000

842

(th

ou

san

d u

nit

s)

600

FY05 FY06

Industry TIV: 5.6 million (-4.1%)

Market share : 13.2% (-1.2 point)


740-12.1%

Skyline

Pino


Industry TIV: 16.5 million (-3.4%)*

Retail sales: U.S.

0

300

600

1,200

1,500

1,035-4.0%*1,075

(th

ou

san

d u

nit

s)

900

FY05 FY06

Market share: 6.3%


*adjusted to DSR (daily selling rate)

Versa

Altima


0

200

300

500

600540

-0.2%541

(th

ou

san

d u

nit

s)

400

FY05 FY06

Retail sales: Europe

Industry TIV: 20.6 million (+0.6%)


Navara

Note

Market share: 2.6%


(th

ou

san

d u

nit

s)

Retail sales: General Overseas Markets*

GOM

*Including Mexico and Canada

0FY05 FY06

200

400

800

1000

600

1,168+5.1%1,111

FY05 FY06

China

297363

+22.2%

156

207

137

PV sales

LCV sales

160


1200

TiidaLivina Geniss


JD Power APEAL: Segment-leading modelsBuilding our brand

Large MAVHighest ranked: Armada

Midsize PremiumHighest ranked: M-Series

Midsize MAVHighest ranked: Murano

Large Premium MAVHighest ranked: QX56

Large PickupHighest ranked: Titan

Segment-leaders in 5 of 19 categories


Building our brandEnhancing quality – Consumer reports

Altima

Infiniti G35 Infiniti M

FY 2004 Third Quarter ReviewFY06 financial results/ NISSAN Value-Up April 26, 2007




Outlook for FY07

Sales Financing

Agenda



Overseas subsidiaries* adjusted to “April-March” accounting period

Affected countries including; Europe, Mexico, Thailand and South Africa

MARFEBJANDECNOVOCTAUGJULJUNMAYAPRFEBJAN MAR SEP

Q1 Q2 Q3 Q4

March year-ending companies

+ + +Q1 Q2 Q3 Q4 = 12 months

December year-ending companies

+ Q5Q1 Q2 Q3 Q4+ + + = 15 months

Q1 Q2 Q3 Q4 Q5

MARFEBJANDECNOVOCTAUGJULJUNMAYAPRFEBJAN MAR SEP

*exclusive China & Taiwan

Following automotive industry standardsChange in consolidation methods


(bil

lio

n y

en

)

FY051H

O.P.411.5

Sellingexpenses

(Incl. incentives)-21.8

Scope of consolidation

+8.4

600.0

650.0

700.0

750.0

800.0

850.0

900.0

950.0

1,000.0

550.0

FY06w/ Q5O.P.776.9

FY05

O.P.

871.8

FOREX+70.8

ProductEnrichment and regulatory costs

-66.3Purchasing

cost reduction

+170.0

Manufacturing expenses

-4.9

R&Dexpenses

-1.4

G&A others

-6.6

Warrantyexpenses

+1.9

Q5 Effect+21.4Raw material

/Energy cost-110.1

Price/Volume mix

-156.3

FY0612

monthsO.P.755.5

FY06 financial performanceOperating profit variance analysis


(billion yen)

Eliminations: FY05: -32.4, FY06 :+9.4

FY06FY05

100

50

0

EUROPE

FY06FY05

101.2

U.S. (+CAN)

FY06FY05

345.4

FY05

JAPAN

FY06

400

200

0

390.4270.6

113.3

282.6

67.279.6


GOM (Including Mexico)

Operating profit by region (12 months)


1. Foreign exchange impactUSD +39.2 (113.3 -> 117.0)

EUR +16.7 (136.9 -> 146.2)

-156.3

US -71.4 EUR -25.2 GOM +3.2

Peso +4.7 (10.2 -> 10.7)Others +10.2

-21.8

+70.8（billion yen）

2. Price / Volume & mix

3. Selling expenses

J -62.9

US&CAN -22.9 EUR +1.4 GOM -6.9J +6.6

+8.44. Scope of consolidation

Calsonic Kansei subsidiaries +5.0

Operating profit variance analysisFinancial results (FY06 full year)


Consolidated net revenue

Consolidated operating profit

Ordinary profit 18.5845.9

767.6

21.4

9,428.3

871.8


FOREXRate

¥117.0/$¥148.2/€

¥113.3/$¥136.9/€

742.6

9,701.0

755.5

761.1

10,468.6

776.9

¥117.0/$¥146.2/€

FY05 Q5(billion yen) FY0612month

FY06with Q5

CAPEX

R&D

Net income 11.6449.2

Depreciation

475.0

447.6

518.1

307.1

509.0

464.8

460.8

356.1


(billion yen)Detail of extraordinary gains/losses

Financial results (FY06 full year)

• Sale of fixed assets (Company house, NNA HQ, Calsonic Kansei subsidiaries)

+32.0

• Sale of investment securities(Nissan Diesel, Jatco)

+15.7

• DFL change of pension scheme +17.9

+73.7Extraordinary gains

Full Yearwith 5Q

4Qwith 5Q

+14.7

+4.0

+0.0

+21.7


(billion yen)Detail of extraordinary gains/losses

Financial results (FY06 full year)

• loss on disposal of fixed assets -25.4

Extraordinary losses

• Impairment loss on fixed assets(mainly reorganization of domestic sales network)

-22.7

-137.3

• NNH loss on changes equity due to merger -5.9

• NNA HQ relocation-10.8

• DFL dilution loss -5.0

• Voluntary transition programat Smyrna and Decherd plants

-5.4

-22.6

Full Yearwith 5Q

4Qwith 5Q

-11.6

-8.1

-72.7

+0.0

-1.6

+0.0

-5.4

-22.6•Voluntary retirement programs in Japan


Financing activities-165.7 billion yen

Free cash flow21.0 billion yen

(billion yen)

Net cash change

Net automotive

cash at beginning

of FY06

Dividend paid

FX rateimpact

Other financial activities

Treasury stock

Investing activities

Net cash from

operations

372.9-496.8

-131.1

+18.7

-53.3

+26.5

1038.6

0.0

200.0

400.0

600.0

800.0

1,000.0

1,200.0

1,400.0

Workingcapital

and others

-255.1

Net automotive cash at the end of FY06

254.7

Tax paid

-265.7



29

Div

iden

d p

er

share

/ y

en

19

14

24

40

34

7

0

8

Nissan Value-Up Dividend policy

FY99 FY00 FY01 FY02 FY03 FY07

20

10

40

0

30

FY04 FY05 FY06

NISSAN 180 NISSAN Value-UpNRP


Infiniti globally recognized luxury brand

TaiwanMiddle East

North America

Korea 05

Russia 06

NISSAN Value-Up Update

G35 Sedan

FX

China 07Europe 08

Ukraine 07


NISSAN 180 NISSAN Value-UpNRP

Light Commercial Vehiclesth

ou

san

d u

nit

s

FY00 FY03 FY07*0

300

400

200

100

0%

6%

4%

8%

2%

Co

nso

lid

ate

d o

pera

tin

g m

arg

in

FY01 FY02 FY04 FY05 FY06

7.7%

>8.0%

*Breakthrough Commitment

*

NISSAN Value-Up Update

Objective

490

401

Objective achieved one year ahead of plan


Thailand

China

EgyptIndia

RomaniaHungary

Vietnam Mexico

Mercosur

BreakthroughNISSAN Value-Up updateLeading Competitive Countries

FY05 FY06 FY07

10

0

20

30

12%15%

24%

LCC utilization ratio


New partnership with Renault and Mahindra to build a plant in Chennai in 2009Planned capacity of 400K units

2009: New plant in St. Petersburg50K capacity

Russia

2005: New R&D center2006: Huadu engine plant

China

2009 : 40,000 sales

Brazil

India

Geographic expansionNISSAN Value-Up Update




Outlook for FY07

Sales Financing

Agenda


Production adjustment in JapanTransition to a single-shift at the Oppama and Tochigi plants in FY07 1Q

Voluntary transition program in the U.S.Provision booked at FY06 by 5.4 billion yen

Planned restructuring in South African plant operation Under consultation with National Union

Dealer network restructuring in JapanFocus more and better-trained resources directly on the customer

Voluntary retirement programs in JapanProvision booked at FY06 by 22.6 billion yen

Nissan Shatai’s plant integrationClose current plant #1 at Hiratsuka and shift production to #2 and expansion of Kyushu

Transforming sales network in Europe National sales companies into leaner regional business units

FY07 outlookAdditional measures already taken


3,700+6.2%

Global retail sales objective

0FY03 FY04 FY06

3,389

(th

ou

san

d u

nit

s)

3,569

2,000

2,500

3,500

4,000

3,000

3,057

*Including Mexico and Canada

FY07**

+6.3% U.S.

-5.4% Japan

+11.2% Europe

+11.3% GOM*

**Forecast

FY07 outlook

FY05

3,483

1,100

700

1,300

600


Opportunities

NISSAN Value-UpRising raw material costs

Rising energy prices

Rising interest rates

Volatile foreign exchange rates

Higher level of incentives

Growing # of distressed

suppliers and competitors

Risks

FY07 outlook


FY06 FY07(billion yen)

Consolidated net revenue 10,300.0

Net income 480.0

Ordinary profit 773.0

FOREXassumption

¥117.0/$¥148.0/€

R&D sales ratio

490.04.8%

CAPEXsales ratio

515.05.0%

Consolidated operating profit 800.0

FY07 outlook

10,468.6

460.8

761.1

464.84.4%

509.04.9%

776.9

¥117.0/$¥148.2/€


107

Post NISSAN Value-UpNISSAN Value-Up


Total: 28 Total: 33+

Product pipeline – new products

11


U.S.

Japan

GOM(including Canada and Mexico)

Europe

Global product launches

NISSAN Value-Up

10 1172 5 1 9

FY05 FY06 FY071st half 2nd half

Serena

Otti

WingroadBluebird Sylphy

Moco

1st half 2nd half

Micra C+C

Livina Geniss

Cabstar

SentraAltima

G35 sedan

Otti AD

PinoAtlas 20

Almera

Classic

Altima coupeG37 coupe

Qashqai X-TRAIL

Atlas 10

LivinaEntry-level

sedan

RogueInfiniti EXMurano

6 5

GT-R

Frontier

Navara S/C

“Start of Sales” (SOS) Basis

1st half 2nd half


Billio

n y

en

R&D

4.0%3.8%

4.2%4.4%

4.8%

R&D expenditure

200

400

300


500

300

354

398

262

4.6%

239

FY05

448465

4.4%

FY06

490

FY07*

4.8%

4.7%

232

3

5

4

6

% o

f net re

ven

ue

Investing in our future

*Forecast


LDWLow cost fuelefficient T/M

Pre crash seat

belt

04IT 06IT

Intelligent

Brake Assist

Rear active

stear

Low cost

NAVIHEV(TK)

Support Carwings JK

Active AFS Low speed ICC

Intelligent Air

conditioner4WAS

FR-L p/f FF-L p/f e-4WD Scratch Guard D-p/f

00 01 02 03 04 05 06

45

3

5

07 08 09 10

8

6

>15FY07: 8 NEW technologies

Original technology

# o

f te

chn

olo

gie

s d

ep

loye

d

Investing in innovation

4 Wheel Active Steering

2 2 2


Camera

Around View Monitor

Lane Departure Prevention

3World’s-FirstTechnologies


Feedback force from gas pedal

Automatically apply brake when driver releasesgas pedal

Distance Control Assist System



Advanced Battery Technology

EV

FCV

Nissan-Original Hybrid

Biofuels

Advanced Diesels




Outlook for FY07

Sales Financing

Agenda


Sales financing: Penetration

NMAC

24%

23%

NFS

31%

0%

10%

20%

30%

40%

50%

60%

NCF

40%

30%

RetailLease


70%

4%

30%

4%

27%

22%

50%

23%

NFS: Nissan Financial Service, sales finance company in JapanNMAC: Nissan Motor Acceptance Corporation, sales finance company in USANCF: Sales financing division of Nissan Canada Inc.,


Sales financing: Net loss ratio

NFS Lease: 0.07%Retail: 0.21%

NMAC Lease: 0.42%Retail: 1.06%

Lease: +0.01%Retail: -0.05%

Lease: +0.07%Retail: +0.07%

NCF Lease: 0.10%Retail: 0.33%

FY05 VarianceFY06

Lease: +0.01%Retail: +0.14%

Lease: 0.06%Retail: 0.26%



NFS: Nissan Financial Service, sales finance company in JapanNMAC: Nissan Motor Acceptance Corporation, sales finance company in USANCF: Sales financing division of Nissan Canada Inc.,


(As of FY06 end)

retail

leasewholesale

(JPY in B)

FY03

NMAC(USD in M)

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

14,928

13,402

5,033

NFS

0

200

400

600

800

1,000

1,200

1,400

899.1

156.0

355.5

（securitization adjusted）

Sales financing: Asset structure

FY03

NCF(CAD in M)

0

500

1,000

1,500

2,000

2,500

3,000

3,500

1,032

2,278

（securitization adjusted）


<NFS>

17.7

1,525

22.1

(Ass

et/

bil

lio

n y

en

)

(Op

era

ting

pro

fit/billio

n ye

n)

FY05 FY060

500

1,000

1,500

0

5

10

20Reasons for OP change

Increase

• Asset increase and others

4.3 B yen

• Reduction of allowance

and expenses 2.8 B yen

Decrease

• Interest rate rise 2.7B yen

2,000

15

1,493

Sales financing: Operating profit, Total asset


(as of March 2007)

21.5%CP

Total funding amount1,397.8 billion yen23.4%

L/T loan

5.7%on balance ABS

5.6%Equity

12.2%off balance ABS

12.9%Bonds

18.7%S/T loan

Sales financing: Funding sources＜NFS＞


<NMAC>

34,886360

0

50

100

200

250

0

5,000

10,000

15,000

25,00033,159

320

(Ass

et/

mil

lio

n U

SD

)

(Op

era

ting

pro

fit/ millio

n U

SD

)

FY05 FY06

30,000 300Reasons for OP change

Increase

• Asset increase 73M

• Reduction of allowance etc.

17M

Decrease

• Interest rate rise 130M

Sales financing: Operating profit, Total asset

35,000

20,000

150

350


(As of March 2007)

26.5%Group finance

4.4%CP

Total funding amountUSD 30,938 M

7.9%L/T loan46.4%

on balance ABS

8.9%Equity

6.0%Bonds

Sales financing: Funding sources＜NMAC＞


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FY06 Financial Results Small Meeting€¦ · • Sale of fixed assets (Company house, NNA HQ,...

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