Nissan Global Sees A 12% Profit Drop

Nissan Motor reported a 12% slide in operating profit in the most recent quarter as foreign exchange rate losses, deteriorating sales mix and one-time costs for dealing with a vehicle inspection scandal in Japan offset only meager volume gains.

Operating profit declined to 210.5 billion yen (USD1.98 billion) in the fiscal fourth quarter ended March 31, the company announced in its earnings report on Monday.

Net income fell 32% to 168.8 billion yen (USD1.59 billion) in the January-March period.

Revenue dipped 0.9% to 3.42 trillion yen (USD32.2 billion), as worldwide sales advanced 1.7% to 1.7 million vehicles in the 3-month period.

Nissan’s results were hit by the yen’s appreciation against the U.S. dollar and other currencies. The company also booked a 20 billion yen (USD188.3 million) charge for the faulty final inspections that hammered the company in the domestic market last year. Falling wholesale volume and deteriorating mix lopped off another 48.1 billion yen (USD452.8 million) in the quarter.

Still, Nissan was able to make some progress on reining in marketing and selling expenses, a top priority for CEO Hiroto Saikawa. He is pivoting the company away from profit-draining fleet sales and incentives in the U.S. in an attempt to shore up brand value and margins.

Cutbacks on the outlays boosted global operating profit by 40.0 billion yen (USD376.6 million).