Nissan says 2022 will be a “more severe” year than 2021
Company returns to profitability after three years in 2021
Nissan Motors, in its outlook for 2022, has said it expects the market environment to be more severe than in fiscal year 2021 due to ongoing semiconductor supply shortages, higher raw material prices and logistics costs, the Ukraine crisis and the impact of lockdowns on parts supplies in China.
However, the company in a press note said, that with a stronger business foundation and continued transformation, Nissan aims to maintain an operating profit at the same level as fiscal year 2021 ensuring the momentum of products, improving quality of sales, and further strengthening financial discipline and control of fixed costs.
In FY 2021, the company said the situation remained extremely challenging, affected by external factors such as the prolonged spread of Covid, the semiconductor supply shortages, and high raw material prices. Despite these challenges, Nissan has continued to make steady progress with its Nissan NEXT transformation plan by strengthening its business foundation, improving quality of sales, and bringing new models to market.
In fiscal year 2021 profitability improved significantly year on year due to continued financial discipline and strict control of fixed costs, the company said. The improvement in the quality of sales globally supported by favourable market conditions in the US market, led to a significant increase in net revenue per unit of major new models contributing to improved profitability for the period.
For the full fiscal year, consolidated net revenue was 8.42 trillion yen, resulting in an operating profit of 247.3 billion yen with an operating margin of 2.9 percent, and a net income1 of 215.5 billion yen. The fiscal year also marked Nissan’s first return to profitability in three fiscal years and the achievement of an operating margin of 2 percent, set as a milestone under Nissan NEXT. Free cash flow for the automotive business was a negative 294.7 billion yen, automotive net cash was 728 billion yen.
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