Nissan Motor Ltd S/Adr

Good evening, everyone. Welcome to Nissan's third quarter financial results for fiscal year 2025. I'm Lavanya Vadgaonkar from Nissan Global Communications, and I'll be hosting today's session. Today, the session will run for 45 minutes. We're meeting here on site, and the session is also being live streamed. Let me start with the introduction of our speakers. Ivan Espinoza, Chief Executive Officer. Jeremy Papin, Chief Financial Officer. I will now hand over to Ivan to begin the session. Ivan.

Thank you, Lavania, and good afternoon, everyone. Thank you for being with us today. This has been a quarter of tangible progress in our operations and in advancing Renison, thanks to the sustained efforts of our employees and the strong support of our partners during this demanding period. Today, Jeremy will begin the session with the details of our financial performance and the latest outlook for the full year, and then I will update on the progress of reNissan recovery plan. After that, we will be taking your questions. Jeremy?

Thank you, Ivan. Good afternoon, everyone. Like Ivan said, this is a quarter where Nissan's determination has truly shown through, with teams across the company pushing forward with resilience. I will begin with our sales performance. For the nine months to December 31st, Nissan sold 2.26 million units, down by 5.8% year-on-year, and excluding China, the decline was 5.2%. In the latest three-month period, we saw a slowing rate of decline, with unit sales down by a more modest 2.9%. North America's state study, with sales up 1%, over the nine months and flat in the last quarter. However, our U.S. for U.S. strategy, sharper incentives and stronger dealer engagement pushed pure retail volume up and kept profitability tight. Retail sales rose 3% year-on-year, with Q3 retail share up 80 basis points, powered by our U.S.-built lineup of Pathfinders, Frontiers, Rogues and QX60s. In China, sales were down by 8% over the nine months. However, in the most recent quarter, we saw a strong rebound of 12.7%, driven by increased demand for the N7. Our sales in China have now been growing year on year since June 2025. Japan remained challenging, with year-to-date sales down by 17.7%. And Europe is also soft, posting a 9% decline. Across other regions, sales were down 7.6%. Even though our overall sales performance is negative, we are mitigating the impact of tariffs, like in the U.S., where we are strengthening dealer engagement and increasing pure retail volume. Our negative year-on-year sales performance is partly driven by changes in our car flow as we have to adjust to the new tariff conditions. The new models we have launched are resonating well with customers worldwide, even as we continue the broader renewal of our lineup. Turning to our financial performance, for the nine-month, net revenue declined to 8.58 trillion yen, reflecting lower unit sales. However, our operating loss of 10.1 billion represents an improvement from the first half as the benefits of renaissance cost actions begin to come through. Our net loss was $250 billion, largely reflecting non-cash asset impairments and restructuring costs taken so far. We maintained disciplined capital allocation, with CAPEX at $349 billion and R&D at $412 billion, as we eliminated non-essential investments, prioritized key programs, and saw accelerated development benefits flow into an R&D cost. In the automotive business, net revenue was $7.6 trillion. Our operating loss was $234 billion, and we recorded a negative free cash flow of $691 billion. At the end of the period, net cash stood at $958 billion. We continued to retain strong liquidity. with 2.15 trillion of automotive cash and cash equivalents on hand and 2.58 trillion of unused committed credit lines. These liquidity levels are unchanged since March. This slide shows the year on year operating profit variance factors. Foreign exchange had a negative impact of 52.2 billion reflecting continued currency pressure. Raw materials provided a positive contribution year-to-date of $9.3 billion. As in previous quarters, tariffs remained the single largest headwind with a total impact of $232 billion. Weaker sales performance, despite an improvement in mix, contributed an $11.8 billion negative impact on the operating profit. On the positive side, we delivered strong monozukuri cost improvements, primarily driven efficiencies across manufacturing and R&D, as well as logistics optimization. This is an area where we continue to see strengthening sequential benefits. Inflationary pressures accounted for a further 63 billion. We have enjoyed one-time gains of 81 billion, of which the newly added item was a 16.4 billion benefit from lower UK CAFE costs. Other items were 84.4 billion positive, with efficiencies in sales finance, remarketing, and GNA all contributing positively. Taken together, these factors resulted in an operating margin of 0.1% for the period. In addition to the nine-month result, it is important to note that the latest three-month period shows clear sequential improvement from the second quarter. We delivered a positive operating profit of $17.5 billion, supported by gains in foreign exchange and raw materials, but mostly due to continued progress in monozukuri cost efficiencies. While tariffs and softer volumes still waited on performance, the quarter showed a slowing rate of decline in sales and an improving contribution from internal cost actions. These sequential gains in operating profit and operating efficiency demonstrate a stronger underlying trend reinforced by re-Nissan measures. Let me move to the outlook, where the stronger trends allow us to lift our forecast for the remainder of the year. I'll start with volume. Given the challenging sales in the first nine months, we now expect global sales volume to come in at 3.2 million units for fiscal 2025. This represents a downward revision of 1.5% from our previous sales forecast. We maintain a positive view on delivering this outlook, grounded in the strength of our products, including new models, stakeholder recognition, and a more stabilized tariff environment. In the U.S., we continue to prioritize retail sales, which have grown month over month, and we expect further gains as brand perception strengthens. In Japan, we are executing highly targeted marketing investments to drive showroom traffic up. Additionally, in Q4, we anticipate good sales from the retention of a strong customer base. China market continues to be soft, but our focus remains on sales of our core models to meet customer demand. In line with the revised sales volume outlook, we are revising our production volume forecast to 2.9 million units. We now anticipate full year revenue of 11.9 trillion, an upward revision of 200 billion from our previous outlook. Our forecast for Consolidated operating loss is $60 billion, reflecting strong progress we're making on fixed cost reduction under the Renissan plan. Our net loss outlook of $650 billion includes restructuring charges under Renissan and potential additional restructuring and business alignment decisions that we may make in Q4. This projected net loss is predominantly the result of non-cash accounting changes. This assumes forex rates of 149 yen to the dollar and 173 yen to the euro. Here is a brief walkthrough of the key drivers of operating performance. We expect a 35 billion negative impact from currency for the full year. Raw materials are expected to have no impact year on year. But tariff costs will be a headwind of 275 billion. Monozukuri savings of $200 billion will offset inflationary pressures of $95 billion. We also expect one-time gains of $81.3 billion and $33.9 billion positive contribution under other items. This captures the main financial trends shaping our performance. Fixed cost reductions are firmly in place and are already contributing. Viable cost efficiencies are showing early signs of improvement. We are strengthening the foundation and momentum is building. I will now hand it over to Ivan. Thank you, Jeremy.