small mtg ENG - Nissan€¦ · Global retail sales volume FY04 Thousand units FY99 FY00 FY01 FY02...

FY04 financial results Small Meeting

NISSAN MOTOR CO., LTD.Akira Sato, VP

April 28, 2005

AgendaAgenda

FY04 sales performance

FY04 financial performance

FY04 sales finance business

FY05 outlook

NISSAN Value-Up

Improvement of pension fund

Global retail sales volumeFY04

Thou

sand

uni

ts

FY99 FY00 FY01 FY02 FY03 FY04

2,597

3,057

2,6332,530

2,771

3,388+10.8%

1990: Record sales 3,107

2,200

2,800

3,000

2,600

3,200

3,400

2,400

Thou

sand

uni

ts

2,499

3,064

2,614

2,402

2,737

3,378+10.2%

Global production

2,200

2,800

3,000

2,600

3,200

3,400

2,400


FY04

Record production 3,085

JapanFY04 sales performance

983

848+1.4%

837

Fuga “RJC Car of the Year”

March Cube

Tiida Note4 models in top 10monthly sales ranking

FY03 FY04

Thou

sand

uni

ts

0

600

800

400

1,000

200Industry TIV: 5.8 million (-1.2%)Nissan share: 14.6% (+0.4 point)

United States

856

Thou

sand

uni

ts

1,013+18.4%

0

600

800

400

1,000

200

Pathfinder

Frontier

TitanAltima

FY03 FY04


Industry TIV: 16.9 million (+0.4%)Nissan share: 6.0% (+0.9 point)

Thou

sand

uni

ts

0

80

100

60

120

140

40

Infiniti sales performance

124

78 71

96

76

132+6.5%


Europe

544+0.3%

542

Thou

sand

uni

ts

Industry TIV: 19.8 million (+4.2%)Nissan share: 2.7% (-0.2 point)

X-TRAIL

Pickup0

600

800

400

1,000

200

FY03 FY04


983+19.5%

822

Thou

sand

uni

ts

China sales: 194,000 (+92.7%)Including Dong Feng LCVs

General Overseas Markets**

*Including Mexico and Canada

Teana “Car of the Year 2005”

0

600

800

400

1,000

200

FY03 FY04


AgendaAgenda




FY05 outlook

NISSAN Value-Up


FY03 FY04(Billion yen)


FOREX for FY04 ￥107.6/$1, ￥134.4/€1

Change

Net non-operating expenses -15.2 -5.5 +9.7

Financial costs -15.7 -10.4 +5.3

Ordinary profit 809.7 855.7 +5.7%

Net extraordinary losses -73.2 -62.5 +10.7

Net income 503.7 512.3 +1.7%

Net income before tax 736.5 793.2 +7.7%Taxes -219.0 -258.0 -39.0Minority interests -13.8 -22.9 -9.1

Impact on operating profitFY04 financial performance

Billio

n ye

n

Scope of consolidation

+31

FY04OP

861.2

FY03OP

824.9

Forex-78

Salesexpenses

-114

Manufacturing expenses

-15

Warrantyexpenses

-41

R&Dexpenses

-44

Volume/mix+284

900

800

1,000

Purchasingcost

reduction+131

Productenrichment

-92

G&Aand

others-25.7

Operating profit by region Billion yen

Eliminations: FY03 +5.4, FY04: -0.4

FY04FY03

66

GOM (Including Mexico)

84.8

U.S. (+CAN)

FY04FY03

379.7351.8

FY04FY03

400

200

049.2

EUROPE

56


FY03

JAPAN

FY04

400

200

0

341.1352.5

Incentives in the U.S.: CNW

1999 2000 2001 2002 2003 2004 2005

FordFord

$ pe

r uni

t

0

1,000

2,000

3,000

4,000

5,000

ToyotaToyota

HondaHonda

ChryslerChrysler

GMGM

NISSAN

Net cash flow (automotive)

-100

Billion yen

Net debt at beginning of FY03

Net cash at end of FY04

-13.6205.8100

200

300

400

500

600

700

800

0

Cas

hD

ebt

-450.7

Investing activities

Free cashflow

-209.1

Financing activities

Operating activities+879.2

FY04 financial performanceNet automotive debt

2,100

1,349.7

952.7

13.6

431.7

-215.9-8.6

Under new accounting standards

FY98 FY00 FY01 FY02 FY03 FY04FY99

1,000

1,500

500

2,000

2,500

0

-453.5-205.8

Billio

n ye

n

COPFixed assets

+ Net working capital+ Cash on hand

ROIC(Auto)

=

1.3%

7.5%

19.8%21.3%

12.7%

20.1%*

0

10%

15%

5%


20%

25%

FY04 financial performanceReturn on invested capital (ROIC)

*Same scope of consolidation as P&L, excluding change of cash compared to FY03

% o

f net

reve

nue

Canton plant investment included from FY01

Billio

n ye

n

3.4%3.4%

CAPEXCAPEX

4.1%4.1%

5.3%5.3%

R&DR&D4.0%4.0%

3.8%3.8%

4.2%4.2%4.4%4.4%

4.8%4.8%

478

Investment in our futureFY04 financial performance

200

400

300


500

3

5

4

6

FY05

300

378

354

398427

262

326

540

450

5.5%5.5%5.8%5.8% 5.6%5.6%

6.0%6.0%

4.6%4.6%5.0%5.0%

239 244 232 206

Div

iden

d pe

r sha

re /

yen

40

1914

24

3429

7

0

8

Dividend policyFY04 financial performance

FY99 FY00 FY01 FY02 FY03 FY07*

20

10

40

0

30

FY04 FY05* FY06*

*Forecast

AgendaAgenda




FY05 outlook

NISSAN Value-Up


Sales finance business

NMAC

FY03 FY04

NFS

0%

10%

20%

30%

40%

50%

60%

FY03

NCFI

NFS: Nissan Financial ServiceNMAC: Nissan Motor Acceptance CorporationNCFI: NCFI: Nissan Canada Finance Inc..

FY03 FY04

RetailLease

Penetration

26.4%

3.2%3.2%35.2%

14%

41.7%

17.3%

14.7%13.8%

35.0%37.0%

FY04

26.1 %

3.3%


NFS

FY03 FY04

Lease: 0.05%Retail: 0.28%

NMAC Lease: 0.37%Retail: 1.07%

Variance

Lease: -0.03%Retail: -0.10%

Lease: -0.16%Retail: -0.06%




Lease: -0.02%Retail: +0.01%


NCFI

Net Loss Ratio

NFS: Nissan Financial ServiceNMAC: Nissan Motor Acceptance CorporationNCFI: NCFI: Nissan Canada Finance Inc..

FY03 FY04

(billion yen)

(Ass

et/b

illion

yen

) (OP)

1,118.6

1,378.2

14.7

11.0

Sales finance businessOperating Profit / Asset

(Ass

et*/

mill

ion

USD

)

FY03 FY04

(Million U

SD

)

(OP)

24,721

NMACNFSNFS: Nissan Financial ServiceNMAC: Nissan Motor Acceptance Corporation,

468

0

300

600

900

1,200

0

5.0

10.0

15.0

20.0

0

200

400

600

800

0

10,000

20,000

30,000

40,000

427

30,227


Total funding amount ： 4,503.7 billion Yen

(= Total assets – Other liabilities + off balance sources)

Funding

As of March 31, 2005

3.9%Bonds

21.4%Group finance(Inter-Company)

2.9%S/T loan

10.8%L/T loan

38.4%ABS On B/S

6.4%ABS Off B/S

7.5%Equity

8.7%CP

AgendaAgenda




FY05 outlook

NISSAN Value-Up


0

1,500

2,000

1,000

FY01 FY02 FY03 FY04 FY05*

3,000

3,500

500

FY05 outlook

2,597 2,7713,057

3,3882,500

3,618+6.8%

TIV assumption: 61 million (+0.7%)Thou

sand

uni

ts

*Forecast

FY05 new models

JapanSerena

OttiCompact wagonM-class sedan

Minicar

Europe

U.S./Canada

GOMQuest Infiniti M Lafesta Pathfinder Tiida hatchback InterstarNavara Tiida sedan Xterra

350Z RoadsterMurano

PathfinderNavara

Micra C+C

0

1,500

2,000

1,000

FY01 FY02 FY03 FY04 FY05*

3,000

3,500

500

FY05 outlook

2,597 2,7713,057

3,3882,500

3,618+6.8%

TIV assumption: 61 million (+0.7%)Thou

sand

uni

ts

*Forecast

+3.3% U.S.1,047

+ 10% Japan933

+1.1% Europe550

+10.7% GOM (+Mexico, Canada)

1,088

RisksVolatility in exchange

ratesHigher interest ratesHigher commodity pricesHigher energy pricesHigher level of incentivesUncertainty on level ofgrowth in U.S. and Japanese markets

OpportunitiesNISSAN Value-Up

FY05 outlook

FY04 FY05(FC)(Billion yen) Change

Consolidated net revenue 8,576.3 9,000 +4.9%

Consolidated operating profit 861.2 870 +1.0%

Ordinary profit 855.7 860 +0.5%

Net income 512.3 517 +0.9%

+13.1%CAPEX 540477.5

ROIC 20.1% ----20% or aboveFOREXfor FY05

￥105/$1￥130/€1

+13.0%R&D expenses 450398.1

FY05 outlook

*Include consolidation of Calsonic Kansei

AgendaAgenda




FY05 outlook

NISSAN Value-Up


Track toward great company

NRP NISSAN 180 NISSAN Value-Up

“Revive our company ”

“Complete revival on track for profitable growth”

“Value up with sustained performance”

Commitments• Profitability in FY00

• Operating profit margin>4.5% in FY02

• 50% debt reduction by FY02

• +1M units by 9/05

• 8% operating profit margin

• 0 automotive debt

• 4.2M units in FY08

• Top level operating profit margin

• ROIC average 20%

Core elements of NISSAN 180Evolutionary plan

More revenue More quality and speedLess

cost

Maximized alliance with

Renault

NISSAN Value-Up commitments

Top level operating profit margin among global automakers in FY05-07

Profit commitment

To sustain performance

0

2

4

6

8

10

12

-3 -2 -1 0 1 2Global Market Share Change from 1999 (%)

CO

P m

argi

n (%

)

GM

RENAULT

PSADCX

HONDA

TOYOTA

BMW HYUNDAI

FORD

VW◆◆ Nissan ◆◆ Competitors in 20041999

2000

2001

20022003 2004 2007

NISSANValue-Up

NRP

N180

Top level operating profit marginNISSAN Value-Up commitments



Profit commitment

4.2 million sales in FY08

Volume commitment

+812

+791

2,597

3,388

Global sales volume

0

2,000

1,000

FY01 FY04 FY08*

4,000

3,000

Thou

sand

uni

ts

4,200 commitment

*Forecast


20% average ROIC over the plan



Profit commitment

4.2 million sales in FY08

Volume commitment

Return on invested capital

Financial metrics comparison

Source: Moody’s Rating Methodology: Global Auto Industry (Sept. 2004) Analysis: NISSAN IR

*Retained cash flow: Cash flow from operation – change in working capital - dividend**Adjusted cash: Cash + marketable securities + VEBA (Voluntary employee’s beneficiary association)

Top profitability

Strong cash flow

Weak liquidity Average investment

ROA

ROEAss

et Turn

over

RCF*/Tota

l Deb

tRCF*/N

et Deb

tFixe

d Cha

rge C

overa

ge

Adj. C

ash*

*/ Tota

l Ass

etCas

h/Deb

t (B/S

)

Adj. C

ash*

*/Tota

l Deb

tMatu

rityR&D/R

even

ue

Deprec

iation

/CAPEX

EBITA Marg

in

0123456

Average rating: A

BMW Honda PSA

DCX VW

Nissan

Toyota

FCF/Total D

ebt

From auto to financeInter-company loan

% o

f int

er-c

ompa

ny lo

an

FY02 FY03 FY040

150

300

450

600

750

900

0%

5%

10%

15%

20%

25%

30%

35%

Billio

n ye

n

1,05035.7%

33.0%

23.1%

% of inter-company loan = inter-company loan/total funding excluding equity

0

10%

15%

5%

20%

25%

NISSAN 180 NISSAN Value-UpNRP

7.5%

19.8%21.3%

12.7%

ROIC average of 20%

FY00 FY02 FY03 FY04 FY05 FY06 FY07FY01FY99

Return on invested capital (auto)

COPFixed assets

+ Net working capital

ROIC(Auto)

=

20.1%*

*Same scope of consolidation as P&L, excluding change of cash compared to FY03

1.3%


Key assumptions

Total industry volume up to 63 million units in FY07

Foreign exchange rateFY05 105￥/$ 130￥/€FY06, FY07 100￥/$ 120￥/€

New global product launches

31

44

28NISSAN Value-UpNISSAN 180

70

New Products

Start of Production

28 all-new modelsNISSAN Value-Up

10 new conquest models

18 replacement models

2828

Infiniti global tier-1 luxury brandBreakthrough

Taiwan

Middle East

Russia

Korea

ChinaNorth America

Japan*

*Japan launch after NISSAN Value-Up

Light Commercial Vehicles

AD VanATLAS

CIVILIAN

CARAVAN

CABSTAR

22 Nissan-badged models

Breakthrough

Thou

sand

uni

ts

0

450

FY00 FY03 FY07*

600

300

150

0

6%

4%

8%

2%

Light Commercial Vehicles

Con

solid

ated

ope

ratin

g m

argi

n

312

187 203 182234

FY01 FY02 FY04

434+40%

Breakthrough

3.3%3.6%

-0.5%1.4%

4.0%

8.0%

Leading Competitive Countries (LCCs)

Thailand

China

Egypt

Maximize opportunities, minimize costs

IndiaRomania

Hungary

Vietnam Mexico

Mercosur

Breakthrough

Geographic expansion

IndiaPakistan

Russia

Egypt Thailand

Gulf Countries China

Eastern Europe

Breakthrough

80％ SU-LEVBy March 06

40％ EV

=

Environmental technologiesOpportunities

1 million CVTs

200,000hybrids

HEV

ULEVULEV

SU-LEVEV

=CVT

CO2 EmissionNOx & HC Emission

New safety approach

Safety Shield

10 new safety technologies in the next three years

Opportunities

AgendaAgenda




FY05 outlook

NISSAN Value-Up


PBO1,217

UnrecognizedObligation

208

Provision501

Asset501

PBO409

Provision228

Asset181

PBO808

Unrecognized208

Provision280

Asset320

PBO363

Lump-sum contribution at June 2005 NML: 202 Bil. YenNS: 26 Bil. Yen

Total 228 Bil. Yen

PBO1,171

UnrecognizedObligation

208

Provision280

Asset683

PBO 46Asset 46

Pension B/S for accounting purpose

Others

TQPP and lump-sumpayment of NML,NS

DC portion

DB portion

(As of Mar.2004, bil. Yen)

Pension B/S after contribution

Funding ratio 41.1%

Funding ratio 58.3%

Asset363

１．Purpose ( Improvement of pension B/S )

Proposal

Asset 139(135*1.03)

PBO363

Asset135

228

UnfundedPortion

235

UnfundedPortion

Annual pension cost in operating profit (7 Bil. Yen)

Lump-sum contribution by 228 Bil. Yen

Difference

7 Bil. Yen / Year5 Bil. Yen for FY05 (9

months)

2. Purpose ( Improvement of operating profit )

(Bil. Yen)

PBO 374(363 * 1.03)

PBO 374(363 * 1.03)Asset 374

(363 * 1.03)

-100

Billion Yen

206

+908

Operating Activity

-540

Investing Activity

246

-100

100

200

300

400

500

600

700

800

0

Cash

Posi

tive

Debt

３. ＦＹ２００５ Net Debt

-228

Financial Activity

Pension fund

Net debt at the end of FY04

Net debt at the end of FY05

4. FY2005 Change of cash on hand

FY04 end

280

OperatingActivity

270

116 -341

Decrease of group financeFrom Auto to Finance

Pension

-228 228 320

Funding fromoutside

DebtMaturity

FOREX-5

(Cash on hand /Auto sales amount)

3.7%

（Bil.Yen）

FY05 end

Lump-sum pension payment is to be financed by debt funding such as bond issuance and L/T borrowing.

JGB 5 year interest rateAppendix 1

* Interest rate is still historically low

NML Bond Maturity ProfileAppendix 2

(As of March 31, 2005）

（Mil. Yen）

185,000

115,000

30,000

50,000

0

70,000

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

200,000


small mtg ENG - Nissan€¦ · Global retail sales volume FY04 Thousand units FY99 FY00 FY01 FY02...

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Transcript of small mtg ENG - Nissan€¦ · Global retail sales volume FY04 Thousand units FY99 FY00 FY01 FY02...