Nissan posts 40.5 per cent drop in half-year profits

TOKYO: Japan's Nissan Motor Co reported on Friday a 40.5 per cent slump in half-year net profits and predicted annual earnings would plunge by two-thirds due to weak global markets and a strong yen.

Nissan posted a net profit of 126.34 billion yen (USD 1.3 billion) for the six months to September, down from 212.42 billion the previous year.

Japan's number three automaker now expects a net profit of 160 billion yen for the full financial year to March, down from 482.26 billion a year earlier and well short of an earlier forecast of 340 billion yen.

"The global financial and economic crisis has had a profound effect on every area of our industry, with the grip on credit and declining consumer confidence being the most damaging factors," said Carlos Ghosn, head of Nissan and France's Renault.

"Since we see no relief in the second half, we are taking all necessary and responsible measures to protect the company and preserve our ability to rebound when conditions improve," he said in a statement.

Nissan said in October it would cut 1,680 jobs in Spain and likely lay off temporary workers in Japan as global demand slumps.

But Nissan said that its overall vehicle sales rose 4.7 per cent in the first half compared with a year earlier thanks to continued solid demand in China and Middle East.

In the United States, sales fell 3.4 per cent but Nissan said it did well considering the overall US market was down 15.1 per cent, allowing the Japanese automaker to increase its share.