Shares of Nissan Motor fell to their lowest in 10-1/2 years on Friday, tumbling nearly 10 percent after the struggling Japanese automaker cut its annual profit forecast and said it would not pay a dividend in the second half, Reuters reports.
Japan’s No. 2 automaker has been badly shaken by the scandal surrounding former boss Carlos Ghosn. But that crisis has been compounded by worsening sales and a brand image tarnished by years of heavy discounting in the United States and other markets.
In a sign of the deepening woes, it also on Thursday posted its first quarterly net loss in nearly a decade.
“It is too early for a halt in downward trend in Nissan’s share price in this environment,” Jeffries analyst Takaki Nakanishi wrote in a note to clients following the results.
Nissan shares finished down 9.6 percent at 513.7 yen (US$4.68) in Tokyo trade on Friday, their lowest in 10-1/2 years and their biggest one-day fall since 2013.
Also on Friday, French carmaker Renault posted its first profit loss in 10 years and set a lower operating margin goal for 2020.
The company, which has a 43 percent stake in Nissan, made an annual profit loss of 141 million euros (US$153 million) for the group share of net income, penalized by charges linked to some of its Chinese joint ventures and as Nissan’s contribution shrank.
It was also hit by a deferred tax charge in France.
Renault set an operating margin target for this year of between 3 and 4 percent, down from 4.8 percent in 2019, and sliced its proposed dividend against 2019 by almost 70 percent from a year earlier.
“Visibility for 2020 remains limited due to expected volatility in demand,” interim chief executive Clotilde Delbos said in a statement, adding that the new guidance did not take into account possible impacts from China’s coronavirus crisis.
Renault has a factory in the central Chinese city of Wuhan, the epicenter of the epidemic, which has been in lockdown to contain the spread of the virus.
It has also suspended operations for at least four days at its South Korean subsidiary in Busan due to supply chain hiccups.
Renault’s group sales fell 3.3 percent to 55.53 billion euros in 2019, in line with its guidance and beating an average forecast of 55.24 billion euros by 20 analysts polled by Refinitiv. Sales were down 2.7 percent at constant exchange rates.
– Contact us at [email protected]