Nissan slashes profit outlook after posting net loss for the quarter

TOKYO -- Nissan on Thursday cut its full-year operating profit forecast by 43 percent. The dismal outlook comes after the automaker posted a net loss of 26.1 billion yen ($238 million) for the October-December third quarter.

Nissan's first quarterly net loss in nearly a decade contrasts sharply with upbeat forecasts from rivals Toyota and Honda.

For its latest three-month period, Nissan posted an operating profit of 23 billion yen, short of analysts’ average estimate for 59 billion yen. Quarterly sales fell 18 percent to 2.5 trillion yen, short of analysts’ prediction for 2.7 trillion yen.

Nissan's global vehicle sales tumbled 11 percent during the October-December period. Sales dropped 18 percent in the United States, with once popular models such as the Rogue SUV crossover and Sentra sedan falling out of favor. In China, sales slipped 0.6 percent.

Nissan now expects to sell 5.05 million vehicles for the entire year, which would be its weakest sales performance since 2013.

The slump in vehicle sales has increased the pressure on new management to fix a company still reeling from the scandal surrounding former leader Carlos Ghosn.

Nissan reduced its full-year operating profit forecast to 85 billion yen, down from an earlier estimate of 150 billion yen. Nissan had initially projected an operating profit of 230 billion yen for the fiscal year through March, but trimmed that last quarter. A year ago, it earned 318 billion yen — which at the time marked its lowest annual income in a decade.

Nissan's sharply waning earnings power has already prompted plans to slash jobs, close manufacturing sites and drop product offerings as the automaker steps back from an aggressive pursuit of market share championed by Ghosn.

"We are making progress, but sales volumes have been weak so we need to do more restructuring than initially planned," Makoto Uchida, Nissan's new CEO and its third since last September, told reporters Thursday.

Sources have said Nissan is set to eliminate at least 4,300 white-collar jobs and shut two manufacturing sites as part of broader plans to add at least 480 billion yen to its bottom line by 2023.

The moves, an expansion of a plan unveiled in July, will also include fewer car models, options and trims on offer while marketing budgets as well as jobs at head offices in the United States and Europe will be slashed, the sources said.

Nissan said it would not pay a dividend for the second half of the year, and that its full-year dividend would be 10 yen per share, a steep drop from the 57 yen paid a year earlier.

The total dividend for the current fiscal year is on track to be 10 yen a share, including the prior payout, Nissan said, the lowest payout since 2011. In November, the Japanese automaker withdrew its dividend outlook after having cut the shareholder payout in May -- the first reduction since it suspended dividends in 2009 amid an industrywide recession.