OKOHAMA, Japan (July 26, 2012) – Nissan Motor Co. Ltd. today announced an operating profit of 120.7 billion yen (US $1.5 billion, euro 1.17 billion) for the first quarter of fiscal year 2012, ending March 31, 2013.

Compared with the first quarter of 2011, operating profit declined 20% due to the worsening foreign exchange impact of an abnormally strong yen, along with higher one-time selling costs, particularly in North America, linked to our product renewal cycle. The general pricing environment was also less favorable than in the prior year period, during which vehicle prices were distorted by supply constraints caused by the March 2011 Japan earthquake and tsunami.

Nissan sold a total of 1,210,000 vehicles globally in the first quarter of the current fiscal year, up 14.6% compared with the same period in 2011.Global market share increased by 0.4 percentage points to 5.9%.

“Nissan has delivered a respectable performance in the first quarter despite challenging macro-economic conditions,” said Nissan President and CEO, Carlos Ghosn. “Our innovative models remain in high demand, with further exciting vehicles due for launch. Against that background, we remain on track to achieve our full-year forecasts.”

Net revenue increased 2.6% to 2.1364 trillion yen (US $26.64 billion, euro 20.78 billion), while ordinary profit came to 111.5 billion yen (US $1.39 billion, euro 1.08 billion) and net income totaled 72.3 billion yen (US $ 900 million, euro 700 million).

In the April-to-June period, Nissan continued to execute on its Power 88 mid-term business plan, designed to enhance its product portfolio and strengthen the group’s brand and sales presence around the world. As part of that plan, two new models were launched during the quarter including the Nissan Altima in the US and the Nissan NV350 Caravan in Japan.

The pace and volume of new product launches is set to accelerate over the coming quarters, renewing major model lines across the Nissan, Infiniti and Venucia brands. Separately, Nissan improved its brand visibility with the launch of “WHAT IF_”, a global multi-media campaign focused on travel hubs and digital outlets. Further product launches and brand initiatives are expected to enhance sales over the remainder of the fiscal year.

First-Half 2012 financial results

• The Group sold 1.33 million units, down 3.3% on first-half 2011. Low sales in Europe were only partly offset by strong international[1] growth.
• Group revenues came to €20,935 million, down 0.8% year on year.
• The Group posted an operating margin of €482 million, or 2.3% of revenues, compared with €630 million (3.0% of revenues) in first-half 2011.
• The Group reported operating income of €519 million in first-half 2012, compared with €772 million in the first half of 2011.
• Net income totaled €786 million, compared with €1,253 million in first-half 2011.
• Automotive operational free cash flow[2] was a negative €200 million.
• Automotive net financial debt amounted to €818 million at end-June.

Commenting on the results, Carlos Ghosn, Chairman and CEO of Renault, said: “In a difficult and uncertain environment, Renault remains on track to meet its 2012 objective of positive Automotive operational  free cash flow”.

Group revenues came to €20,935 million in first-half 2012, down 0.8%. Continued international growth failed to offset the weakness of the European market. Automotive contributed €19,863 million to revenues, down 1.4% on first-half 2011 owing to a decrease in sales in France and Europe. This was only partly offset by a favorable product mix and a slightly positive price effect.

Group operating margin totaled €482 million in the first half of the year 2012, or 2.3% of revenues, compared with €630 million, or 3.0% of revenues, in first-half 2011.

Automotive operating margin was a positive €87 million, or 0.4% of revenues, down €134 million year on year. The decrease mainly resulted from a fall in volumes (-€176million) and an increase in costs owing to product enhancements (-€211 million). In contrast, operating margin benefited from the Monozukuri cost reduction plan (€197 million net) and a reduction in general expenses (€59 million).

Sales Financing contributed €395 million to Group operating margin, compared with €409 million in first-half 2011. The cost of risk rose to 0.44% of average loans outstanding, up from 0.14% in first-half 2011. After reaching a record low last year, the cost of risk remains below its average historic level of 0.60%, reflecting the continuing good quality of the portfolio despite the economic slowdown in Europe.

The contribution from associated companies, mainly Nissan, Volvo AB and AVTOVAZ, came to €630 million in first-half 2012.

Net income amounted to €786 million and net income Group share €746 million (€2.74 per share compared with €4.48 per share in first-half 2011).

Automotive operational free cash flow was a negative €200 million, after accounting for the impact of the negative €444 million change in the working capital requirement since December 31, 2011.

Automotive net financial debt increased €519 million on December 31, 2011, totaling €818 million at June 30, 2012. The debt-to-equity ratio was 3.3% at end-June 2012, compared with 1.2% at end-December 2011.

Since January 2012 Renault SA has borrowed nearly €1 billion in medium-term loans, thereby refinancing almost all of its 2012 bond repayments, while confirming its access to European and Japanese markets. Automotive maintained its cash reserves at €11.1 billion at end-June 2012.

Outlook 2012

The trend of the automotive market (PC+LCV) seen in the first half 2012 should prevail in the second half: global growth and declining sales in Europe. For the full year, the Group now expects global automotive demand to grow by 5% (vs 4% previously).The European market should decline 3 percentage points more than previously forecasted (now -6% to -7%), including a decrease in the French market of -10% to – 11% (vs -7% to -8% previously)

Due to international growth, new product launches in the second half of 2012 and the roll-out of Duster in additional markets, the Group targets 2012 unit sales to exceed the level reached in 2011, provided that there is no further deterioration of the situation in Europe than expected today.

In this context of low global visibility and higher risks in Europe, the Group remains in line to achieve its 2012 target of positive automotive operational free cash flow.
Consolidated Renault results in first-half 2012

ADDITIONAL INFORMATION

The Group’s consolidated financial statements were approved by the Board of Directors on July 26, 2012.

The Group’s statutory auditors have conducted a limited review of these half-year financial statements and their report will be issued shortly.

The earnings report with a complete analysis of the financial results for first-half 2012 is available for download in the Finance section of www.renault.com.

RCI Banque: A dynamic First Half

Despite the decrease of the European automotive markets, RCI Banque managed to maintain new financings at €5.6 billion, stable vs. first half 2011. With an 8% growth in average performing loans outstanding, first-half earnings before tax came to €403 million, down 3% on 2011.

In the first half 2012, RCI Banque proved once again its ability to refinance competitively. €3 billion were raised on the capital markets with maturities of one year or longer, representing 55% of the annual funding plan. Additionally, the newly launched ZESTO retail savings account attracted deposits of €499 million in the period.

• New financings amounted to €5.6 billion, in line with 2011, with close to 510,000 vehicles financed.
• Penetration rate improved to 34.3% of deliveries, up 0.7 point compared with 2011.
• Average performing loans outstanding reached €24.2 billion, up 8.4% compared with first-half 2011.
• Net banking income reached €638 million, up 4.6% vs. 2011, and representing 5.3% of loans outstanding.
• Cost of risk was kept to 0.44% of loans outstanding.
• Operating margin stood at €395 million, 3.3% lower than at end-June 2011.
• Earnings before tax amounted to €403 million, down 3.3% compared with the first six months of 2011.

Commenting on the results, Dominique Thormann, Chairman & CEO of RCI Banque, said: “Despite challenging economic conditions in Europe, RCI Banque maintained its momentum by improving its commercial performance, accelerating its international development and launching new services. In the first half, RCI Banque took a new step to diversify its funding with the launch of a retail savings account, ZESTO. By the end of June, ZESTO attracted more than 10,000 customers, exceeding the initial annual target.”

AN AMBITIOUS COMMERCIAL STRATEGY OF BUSINESS DEVELOPMENT IN TOUGH ECONOMIC CONDITIONS IN EUROPE

Despite the slide in European automotive markets in first-half 2012 (-7.4% compared with 2011), RCI Banque maintained new financing at €5.6 billion, similar to the performance in 2011. There were three key reasons for this:

– RCI Banque continued to grow its international business. Non-European countries accounted for 26% of vehicles financed in the first half of 2012, up from 19% in 2011. Strong increases were recorded in Americas (75% increase over 2011) and Euromed-Africa (46% growth) regions.

RCI Banque will develop its business in Turkey during the second half of 2012 and will implement a strategic partnership in Russia in 2013.

– RCI Banque improved its penetration rate for the third year in a row, to 34.3% of deliveries (+0.7 point vs. 2011).

– RCI Banque developed services and financing for used vehicles. The number of service contracts increased by 16.5% compared with first-half 2011, and RCI Banque provided financing for 86,180 used vehicles, up 7.6%.

FINANCIAL PERFORMANCE REMAINS STRONG

Growth in business outside Europe and improved commercial performance had two direct impacts: average loans outstanding increased by 8.4% to €24.2 billion and net banking income rose by 4.6% to €638 million. Careful control ensured that operating expenses were kept to 1.54% of loans outstanding, or €185 million.

As a result, pre-tax earnings reached €403 million, down 3.3% compared with first-half 2011, mainly due to the change in the cost of risk. The cost of risk was kept under control and amounted to just 0.44% of loans outstanding (by comparison, it stood at an exceptionally low 0.14% in 2011).

RCI BANQUE FURTHER DEVELOPS ITS INTERNATIONAL REFINANCING POLICY

With concerns over euro zone sovereign debt continuing to depress financial markets, RCI Banque successfully pursued the policy aimed at diversifying its refinancing sources, raising €3 billion in first-half 2012.

RCI Banque launched three bond issues on the euro market, raising €1,810 million, and carried out a €750 million public securitization transaction backed by automotive loans. It also conducted several local-currency issues in Argentina, Brazil, South Korea, and its first private placement in Czech koruna.

ZESTO DEPOSIT ACCOUNTS: A PROMISSING ADDITIONAL SOURCE OF FINANCING

Since it was launched on February 16, ZESTO has carved out a position on a highly competitive market. ZESTO offers very competitive terms on the market, and RCI Banque is committed to using the deposits collected to finance automotive loans. More than 10,000 ZESTO deposit accounts have been opened during the first half of 2012, for a global amount of €499 million.

RCI Banque has therefore raised its target for new deposits and is now aiming for a total of €750 million by the end of December.

RCI Banque also wants to build up its savings bank activities and will offer term deposits in France in first-half 2013 and plans to launch savings products in Germany.

By stepping up its expansion on this market, RCI Banque is aiming to attract deposits of €2.5 billion by the end of 2014, which would amount to around 10% of RCI Banque’s total outstanding loans.

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