Quarterly Securities Report
Second Quarter of FY2020
(From July 1, 2020 To September 30, 2020)
(The English translation of the Quarterly Securities Report “Shihanki-Houkokusho”)
Nissan Motor Co., Ltd.
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Quarterly Securities Report
Second Quarter of FY
(From July 1, 2020 To September 30, 2020)
(The English translation of the Quarterly Securities Report “Shihanki-Houkokusho”)
Nissan Motor Co., Ltd.
Table of Contents
Independent Auditor’s Quarterly Review Report
- Cover Page
- Part I Information on the Company
- Overview of the Company
- Key financial data and trends
- Description of business.............................................................................................................................
- Business Overview
- Business and other risks
- Management’s analysis of financial position, operating results and cash flows......................................
- Important business contracts
- Corporate Information
- Information on the Company’s shares
- Members of the Board of Directors and Statutory Auditors
- Financial Information
- Quarterly Consolidated Financial Statements
- Other
- Part II Information on Guarantors for the Company
Part I Information on the Company
1. Overview of the Company
1. Key financial data and trends
Fiscal Year
121st Six months ended September 30, 2019
122nd Six months ended September 30, 2020
121st
Accounting period (^) To September 30, 2019)(^ From April 1, 2019 To September 30, 2020)(^ From April 1, 2020
(From April 1, 2019 To March 31, 2020) Net sales Millions of yen
5,003,075 3,092, 9,878, [Current Second Quarter] [2,630,653] [1,918,493]
Ordinary income (loss) Millions of yen 115,642 (231,838) 44, Net income (loss) attributable to owners of parent (^) Millions of yen 65,365^ (329,959) (671,216) [Current Second Quarter] [58,988] [(44,370)]
Comprehensive income Millions of yen (83,674)^ (372,125)^ (1,084,147)
Net assets Millions of yen 5,452,232 3,993,302 4,424,
Total assets Millions of yen 18,052,901 16,461,043 16,976,
Basic earnings (loss) per share Yen
16.70 (84.33) (171.54) [Current Second Quarter] [15.07]^ [(11.34)]
Diluted earnings per share Yen 16.70 ― ―
Net assets as a percentage of total assets % 28.2^ 22.1^ 23.
Cash flows from operating activities Millions of yen 584,191 730,888 1,185,
Cash flows from investing activities Millions of yen (296,531) (289,348) (708,687)
Cash flows from financing activities Millions of yen (280,788) 399,212 (155,494) Cash and cash equivalents at end of the period Millions of yen^ 1,348,156^ 2,479,063^ 1,642,
Notes: 1. Non-consolidated financial data is not presented as Nissan Motor Co., Ltd. (the “Company”) prepares quarterly consolidated financial statements.
- Net sales are presented exclusive of consumption tax.
- Diluted earnings per share for the first six months of the 122nd fiscal year and the 121st fiscal year is not presented because a net loss per share was recorded although potential dilutive stock existed. 2. Description of business
There have been no significant changes in the business in which the Company and its subsidiaries and affiliates (collectively, the “Group”) operate during the six months ended September 30, 2020. No changes were made to major subsidiaries and affiliates.
2. Business Overview
1. Business and other risks
During the six months ended September 30, 2020, there were no unusual fluctuations with regard to financial position, operating results and cash flows or important changes in the “Business and other risks,” which are described in the Securities Report of the prior fiscal year.
2. Management’s analysis of financial position, operating results and cash flows
Any future forecasts included in the following descriptions are based on the best estimates or judgment of the Group as of September 30, 2020, the end of the current second quarter.
(1) Financial position and operating results
Due to the impact of COVID-19 globally, the global industry volume totaled 32.82 million units for the six months ended September 30, 2020, a decrease of 25.2% from the corresponding period of the last year (the “last year”). Global sales of the Group for the six months ended September 30, 2020 also decreased by 32.1% year on year to 1, thousand units. In addition, due to the decline in the global market and sales volume, net sales of the Group for the six months ended September 30, 2020, totaled ¥3,092.7 billion, which represents a decrease of ¥1,910.4 billion (38.2%) relative to net sales for the last year. Operating loss of ¥158.8 billion was recorded, a deterioration of ¥190.4 billion from the last year. Net non-operating loss of ¥73.0 billion was recorded for the six months ended September 30, 2020, deteriorating by ¥157.0 billion from the last year. As a result, ordinary loss amounted to ¥231.8 billion, deteriorating by ¥347.4 billion compared with the last year. Net special losses of ¥89.1 billion were recorded, deteriorating by ¥78.2 billion from the last year. Loss before income taxes of ¥320.9 billion was recorded, deteriorating by ¥425.6 billion from the last year. Finally, net loss attributable to owners of parent for the six months ended September 30, 2020 of ¥330.0 billion was recorded, a deterioration of ¥395.4 billion from the last year.
(2) Cash flows Cash and cash equivalents at September 30, 2020 increased by ¥836.1 billion (50.9%) from the end of the prior fiscal year to ¥2,479.1 billion. This reflected ¥730.9 billion in net cash provided by operating activities, ¥289.3 billion in net cash used in investing activities and ¥399.2 billion in net cash provided by financing activities, as well as a decrease of ¥4.7 billion in the effects of foreign exchange rate movements on cash and cash equivalents.
(3) Production and sales Actual production
Location of manufacturers
Number of vehicles produced (units) Change (units)
Change Six months ended (%) September 30, 2019
Six months ended September 30, 2020 Japan 390,131 171,961 (218,170) (55.9)
The United States of America 379,295^ 157,583^ (221,712)^ (58.5)
Mexico 308,399 180,810 (127,589) (41.4)
The United Kingdom 161,608^ 80,043^ (81,565)^ (50.5)
Spain 32,288 596 (31,692) (98.2)
Russia 28,406^ 12,558^ (15,848)^ (55.8)
Thailand 75,365 34,983 (40,382) (53.6)
Indonesia 1,770^ ― (1,770)^ ―
Philippines 2,737 1,741 (996) (36.4)
India 93,152^ 33,885^ (59,267)^ (63.6)
South Africa 19,530 5,006 (14,524) (74.4)
Brazil 55,288^ 15,872^ (39,416)^ (71.3)
Argentina 5,625 3,803 (1,822) (32.4)
Egypt 7,705^ 5,402^ (2,303)^ (29.9)
Total 1,561,299 704,243 (857,056) (54.9)
Note: The figures represent the production figures for the 6-month period from April 1 to September 30, 2020.
c. Europe In Europe market, TIV decreased by 28.9% to 7.29 million units due to the impact of COVID-19. The Group sold 142 thousand units in Europe, excluding Russia, down 36.5% from the last year. The Group’s market share decreased by 0.1 percentage point to 2.3%. In addition, the Group’s sales in Russia market decreased by 27.8% to 30 thousand units. As a result, net sales in Europe (including intersegment sales) for the six months ended September 30, 2020 were ¥402.9 billion, a decrease of ¥315.5 billion (43.9%) from the last year. Operating loss of ¥23.1 billion was recorded, deteriorating by ¥1.7 billion from the last year. A major deteriorating factor was a decrease in the number of vehicles sold.
d. Asia Sales volume in Asia market, excluding China, decreased by 46.6% to 61 thousand units. Net sales in Asia (including intersegment sales) for the six months ended September 30, 2020 decreased by ¥218.3 billion (31.8%) from the last year to ¥469.1 billion. Operating income for the six months ended September 30, 2020 was ¥20. billion, a decrease of ¥1.3 billion (6.5%) from the last year. In China market, TIV decreased by 19.1% to 9.33 million units due to the impact of COVID-19. The Group’s sales in China decreased by 17.0% from the last year to 596 thousand units, accounting for a market share of 6.4%, up 0.2 percentage point year on year. The operating results of Chinese joint venture, Dongfeng Motor Co., Ltd., is reflected as an equity in earnings or losses of affiliates in Non-operating income or expenses.
e. Other overseas countries In other markets, consisting of Oceania, Middle East, South Africa and Central and South America excluding Mexico, the Group’s sales volume decreased by 41.5% to 144 thousand units. As a result, net sales in other markets consisting of the aforementioned regions (including intersegment sales) for the six months ended September 30, 2020 decreased by ¥224.9 billion (54.0%) from the last year to ¥191. billion. An operating loss of ¥10.1 billion was recorded, deteriorating by ¥6.1 billion from the last year.
(5) Analysis of sources of capital and liquidity a. Cash flows
(Cash flows from operating activities) Net cash provided by operating activities increased by ¥146.7 billion to ¥730.9 billion in the six months ended September 30, 2020 from ¥584.2 billion provided in the last year. This was mainly attributable to an increase in net cash from the sales finance business on a consolidated basis despite a decrease in revenue resulting from a decline in sales volume due to the impact of COVID-19 and intensifying competition, and loss in the automobile business.
(Cash flows from investing activities) Net cash used in investing activities decreased by ¥7.2 billion to ¥289.3 billion in the six months ended September 30, 2020 from ¥296.5 billion used in the last year. This was mainly due to a decrease in purchase of fixed assets in the automobile business and a decrease in net payment (net difference between the payment for purchase and the proceeds from sales) of leased vehicles in the sales finance business despite a shift from net decrease to net increase in restricted cash related to asset backed securities in the sales finance business. The Group continued to invest in the automobile business, including in new products and the development of new technologies such as advanced driver assistance.
(Cash flows from financing activities) Net cash provided by financing activities was ¥399.2 billion in the six months ended September 30, 2020, an increase in cash inflows of ¥680.0 billion compared with ¥280.8 billion used in the last year. This was mainly attributable to aggressive fundraising such as the issuance of foreign currency denominated bonds taking into consideration the impact of COVID-19.
As cash and cash equivalents at September 30, 2020 exceeded interest-bearing debt, the Group had a net cash position of ¥505.8 billion. Free cash flows in the automobile business for the current second quarter improved significantly from the first quarter to a positive ¥311.0 billion primarily due to improvements in working capital. For the six months ended September 30, 2020, free cash flows in the automobile business were negative ¥504.6 billion reflecting impacts from the profit decline due to the impact of COVID-19 and negative working capital impact due to the decrease in production volume.
Information by segments is as follows:
The Six-Month Period Ended September 30, 2019 (From April 1, 2019 To September 30, 2019) (Millions of yen) Automobile & Eliminations Sales financing^ Consolidated total Cash flows from operating activities (187,076) 771,267 584, Cash flows from investing activities (227,837) (68,694) (296,531) Cash flows from financing activities 409,118 (689,906) (280,788)
The Six-Month Period Ended September 30, 2020 (From April 1, 2020 To September 30, 2020) (Millions of yen) Automobile & Eliminations
Sales financing Consolidated total
Cash flows from operating activities (324,374) 1,055,262 730, Cash flows from investing activities (180,294) (109,054) (289,348) Cash flows from financing activities 1,342,230 (943,018) 399,
Year-on-Year Comparison (Millions of yen) Automobile & Eliminations Sales financing^ Consolidated total Cash flows from operating activities (137,298) 283,995 146, Cash flows from investing activities 47,543 (40,360) 7, Cash flows from financing activities 933,112 (253,112) 680,
b. Financial policies
It is necessary to pay careful attention to the liquidity of the Group in view of the recent cash usage in the automobile business, credit rating downgrade and the impact of COVID-19. However, as the Group has entered into loan commitment agreements with major international banks in addition to the cash and cash equivalents noted above, the Group believes that a level of liquidity sufficient to meet the Group’s funding requirements is being maintained. The Group had ¥2,320.7 billion of cash and cash equivalents in the automobile business as of September 30, 2020. In addition to securing funding in the normal course of its business, the Company and its subsidiaries secured additional funds to meet cash needs due to the impact of COVID-19 in an aggregate amount of ¥895.0 billion with multiple financial institutions after April 2020. The Company also issued USD denominated bonds in an aggregate amount of $8.0 billion and EUR denominated bonds in an aggregate amount of €2.0 billion. The Group had approximately ¥2, billion of committed lines available for drawing as of September 30, 2020.
(6) Management policy and business strategies
The Group defined its corporate purpose as “Driving Innovation to Enrich People’s Lives”. This stated clearly the Company’s raison d’etre, the question of why we exist and the role we play for the society, based on “Enriching People’s Lives” that has been a Nissan's corporate vision for years, keeping the founder’s spirit of “Do what others don't dare to do”. Meanwhile, the Group will strengthen its relationships with suppliers and dealers and work with them to bolster our business model.
As it develops as a company through its full range of global activities, Nissan seeks to not only create economic value but also contribute solutions to society as a leading global automaker. Nissan is committed to all stakeholders— including customers, shareholders, employees and the communities where it does business—and to delivering valuable and sustainable mobility for all. Furthermore, we pursue the realization of a zero-emission, zero-fatality society by actively contributing to the sustainable development of society.
The Group announced on May 28, 2020, a four-year plan, NISSAN NEXT, to achieve sustainable growth, financial stability and profitability by the end of fiscal-year 2023.
Over the years, the Company expanded its business scale (production capacity) centered on emerging markets with the assumption that demand will increase. The Company adopted a stretched growth strategy that placed the highest priority on sales volume.
While this strategy resulted in temporary success, it postponed necessary investments in products and technologies. As a result, the Company was forced to rely on excessive incentives for sales, thus resulting in a damaged brand. Promoting a sales expansion strategy without properly allocating management resources led to the current poor business performance.
The Group announced in September 2020, a realignment of its geographic regional structure along with senior management appointments that will be effective October 1, 2020. As part of NISSAN NEXT, the Company aims to transform into a leaner, agile organization focused on achieving sustainable growth. To this end, the Company is realigning its operations from the current seven regions into four key regions. This realignment and change of senior management appointments enables to be more competitive by improving the speed of our operations and represents a positive shift in the way the Company operates with better global and regional integration. The Group revisited the four categories of the prior fiscal year’s target and decided to use the six categories for the current fiscal year, which are marginal profit, free cash flows in the automobile business, fixed cost, market share, quality and employee engagement. These six categories were selected because they are the drivers contributing to NISSAN NEXT.
(8) Operating and financial issues to be addressed
Operating and financial issues to be addressed by the Group occurring during the six months ended September 30, 2020, are as follows. The former Representative Directors of the Company were indicted on suspicion of violating the Financial Instruments and Exchange Act (charged with submitting false Securities Reports) and a former Representative Director and Chairman was additionally indicted on suspicion of violating the Corporate Law (charged with aggravated breach of trust). In conjunction with these indictments, the Company itself was indicted on suspicion of violating the Financial Instruments and Exchange Act. The Company took this situation very seriously and formed a Special Committee for Improving Governance (SCIG) consisting of several independent third parties and independent Outside Directors of the Company. On March 27, 2019, Nissan’s board of directors received a report from the SCIG that summarizes the committee’s proposals for governance improvements and recommends a framework for the best governance as a foundation for Nissan business operations in the future. The Company has made the transition to a three statutory committee format. On September 9, 2019, the board of directors of the Company received a report from the Audit Committee on the internal investigation into misconduct led by the Company’s former chairman and others. As stated in the timely disclosure released on September 9, 2019 “Nissan board receives report on misconduct led by former chairman and others”, the report confirmed specific instances of misconduct. Among these instances, Ghosn’s personal use of the company’s assets and improper payments of financial “incentives” to Nissan distributors instructed by Ghosn are as follows. Since September 9, 2019, there have been no changes made to the following contents at the time of submission of this Securities Report. In the future, if significant progress occurs in the following contents, we will disclose in accordance with relevant laws and regulations.
A) Ghosn’s personal use of the Company’s assets
The report confirms that Ghosn used the company’s assets for personal benefit, including:
- purchase of residences for exclusive personal use in Beirut and Rio de Janeiro using roughly 27 million U.S. dollars in investment funds from Zi-A Capital, a Nissan subsidiary established under the guise of investing in promising technology start-ups, and further misuse of other company funds to purchase or rent additional residences for personal use;
- payment of sums totaling more than 750,000 U.S. dollars to Ghosn’s sister on the basis of a fictitious consulting contract, starting in 2003 and extending for over 10 years with no evidence of any services having been rendered;
- personal use of the corporate jets by Ghosn and members of his family;
- improper use of expenses toward family vacations and gifts of a personal nature;
- instruction of donations totaling more than 2 million U.S. dollars of company funds to universities in Ghosn’s
ancestral home country of Lebanon with no legitimate business purpose;
- transfer to Nissan in 2008 of foreign exchange swap contracts bearing unrealized losses of roughly 1.85 billion
yen, based on a deceptive explanation to the Company’s board regarding the nature of the transaction (in 2009,
the swap contracts were secretly transferred back to a company related to Ghosn after being flagged as improper
by Japan’s financial authorities);
- improper payments totaling roughly 7.8 million Euros to Ghosn from a joint venture established by Nissan and
MITSUBISHI MOTORS CORPORATION, paid from April 2018 onward under the pretext of a salary and an
employment contract with the joint venture, despite the fact that no contract had been approved by the joint
venture’s board of directors.
B) Improper payments of financial “incentives” to Nissan distributors instructed by Ghosn
Ghosn instructed a Nissan subsidiary to make payments totaling 14.7 million U.S. dollars to a distributor managed by an acquaintance outside Japan who had previously offered him personal financial support (a fact Ghosn withheld from Nissan’s board of directors and the relevant departments within the company). Payments were made under the pretext of covering expenses for special business projects and were approved through Nissan’s CEO Reserve, an emergency budget over which only Ghosn and a selected few direct subordinates had approval authority. Ghosn also instructed a Nissan subsidiary to make payments totaling 32 million U.S. dollars to a distributor outside Japan, an employee of which transferred tens of millions of dollars to Ghosn and a company related to Ghosn (a fact Ghosn withheld from Nissan’s board of directors and the relevant departments within the company). Payments were made under the pretext of granting financial incentives to the distributor in question and were approved through the CEO Reserve.
The Company has filed a provisional disposition order in the British Virgin Islands against Ghosn and related parties for a luxury yacht and has filed a lawsuit based on the order seeking damages, etc. Also, on February 12, 2020, the Company has filed a lawsuit against Carlos Ghosn in Japan, seeking recovery of damages. Going forward, the Company will continue to take necessary measures based on the findings of the Company’s internal investigation, including legal action to claim damages, in order to account for the responsibility of the former chairman and others.
The Company has received a written notice of commencement of trial procedures dated December 13, 2019, from the Commissioner of the FSA. In response to this written notice, on December 23, 2019, the Company has submitted a written answer not disputing the alleged facts and the amount of the administrative monetary penalty. After that, the Company has received the administrative monetary penalty payment order, dated February 27, 2020, of 2,424,895, yen from the Commissioner of the FSA. In accordance with the administrative monetary penalty payment order and payment notice, the Company has made the penalty payment of 1,406,250,000 yen, which became due.
In December 2019, new management has been established, whose members have been selected by the Nomination Committee. As demonstrated by the establishment of new management, strengthening of the supervisory function of internal audit, and so on, the Company is working on various countermeasures to prevent recurrence. The Company continues its efforts to improve its governance, including ongoing implementation of the improvement measures stated in the Improvement Measures Status Report submitted to Tokyo Stock Exchange on January 16, 2020, as well as reviewing necessary improvements from time to time going forward. The Company also continues to reform its corporate culture, renew corporate ethics, disclose corporate information appropriately and enhance compliance- focused management.
(9) Significant accounting policies and estimates
There was a significant change made to allowance for doubtful accounts of the “Significant accounting policies and estimated” of “Analysis of financial position, operating results and cash flows by management,” which is described in the Securities Report of the prior fiscal year. From the beginning of the six months ended September 30, 2020, the allowance is measured as the present value of credit losses expected over the entire life of the asset at foreign subsidiaries and affiliates that apply US GAAP.
This is the change in accounting policy which has been adopted from the beginning of the six months ended September 30, 2020, and please refer to (1) of the section “Change in accounting policies” in 4. “Financial Information.”
(10) Research-and-development activities
The Group has been active in conducting research-and-development activities in the environment, safety and various other fields toward the realization of a sustainable, motorized society in the future.
The research-and-development costs of the Group amounted to ¥238.4 billion for the six months ended September 30,
(11) Major equipment and facilities
The details of the capital investment plan of the Group for the current fiscal year, which were not determined as of the filing date of the Securities Report of the prior fiscal year, have been formulated as follows.
During fiscal year 2020 (From April 2020 to March 2021), the Group plans to invest ¥440.0 billion in capital expenditures, which will be financed out of its own funds.
3. Important business contracts
No important business contracts were determined or entered into during the current second quarter.
(5) Principal shareholders (As of September 30, 2020)
Name Address
Number of shares held
Number of shares (excluding treasury stock) held as a percentage of total shares issued (Thousands) (%)
Renault S.A. (Standing agent: Settlement & Clearing Services Division, Mizuho Bank, Ltd.)
13-15 QUAI ALPHONSE LE GALLO
92100 BOULOGNE BILLANCOURT,
FRANCE
(Shinagawa Intercity A Bldg., 2-15- Konan, Minato-ku, Tokyo)
1,831,837 43.
The Master Trust Bank of Japan, Ltd. (Trust account)
2-11-3 Hamamatsu-cho, Minato-ku, Tokyo
157,217 3.
THE CHASE MANHATTAN BANK, N.A., LONDON SPECIAL ACCOUNT NO. 1 (Standing agent: Settlement & Clearing Services Division, Mizuho Bank, Ltd.) (Note)
WOOLGATE HOUSE, COLEMAN
STREET, LONDON EC2P 2HD,
ENGLAND
(Shinagawa Intercity A Bldg., 2-15- Konan, Minato-ku, Tokyo)
142,502 3.
Custody Bank of Japan, Ltd. (Trust account)
1-8-12 Harumi, Chuo-ku, Tokyo 58,175 1.
Nippon Life Insurance Company (Standing agent: The Master Trust Bank of Japan, Ltd.)
1-6-6 Marunouchi, Chiyoda-ku, Tokyo (Nippon Life securities management portion) (2-11-3 Hamamatsu-cho, Minato-ku, Tokyo)
54,029 1.
Custody Bank of Japan, Ltd. (Trust account 5) 1-8-12 Harumi, Chuo-ku, Tokyo^
49,179 1.
Custody Bank of Japan, Ltd. (Trust account 9)
1-8-12 Harumi, Chuo-ku, Tokyo 47,140 1.
STATE STREET BANK WEST CLIENT - TREATY 505234 (Standing agent: Settlement & Clearing Services Division, Mizuho Bank, Ltd.)
1776 HERITAGE DRIVE, NORTH
QUINCY, MA 02171, U.S.A.
(Shinagawa Intercity A Bldg., 2-15- Konan, Minato-ku, Tokyo)
32,733 0.
JP Morgan Chase Bank 385781 (Standing agent: Settlement & Clearing Services Division, Mizuho Bank, Ltd.)
25 BANK STREET, CANARY
WHARF, LONDON, E14 5JP,
UNITED KINGDOM
(Shinagawa Intercity A Bldg., 2-15- Konan, Minato-ku, Tokyo)
32,016 0.
Moxley & Co. LLC (Standing agent: Debt Finance Department, Sumitomo Mitsui Banking Corporation)
270 PARK AVENUE, NEW YORK,
N.Y. 10017-2070 U.S.A.
(1-3-2 Marunouchi, Chiyoda-ku, Tokyo)
26,505 0.
Total ― 2,431,333^ 58.
Notes: 1 In addition to the above, there are 28,435 thousand shares of treasury stock held by the Company.
2 Daimspain, S.L., Daimspain DAG, S.L. and Daimspain DT, S.L. substantially hold 140,142 thousand shares of the Company, with an individual distribution of Daimspain, S.L. holding 100,505 thousand shares, Daimspain DAG, S.L. holding 25,808 thousand shares and Daimspain DT, S.L. holding 13,829 thousand shares although these shares are in custody of THE CHASE MANHATTAN BANK, N.A. LONDON SPECIAL ACCOUNT NO. 1 on the shareholders’ register.
(6) Status of voting rights
- Shares issued (As of September 30, 2020)
Classification
Number of shares Number of voting rights Description (Shares) (Units)
Shares with full voting rights (Treasury stock, etc.)
(Treasury stock) Common stock ― ― 28,435, (Crossholding stock) Common stock ― ― 199, Shares with full voting rights (Others)
Common stock 41,912,550 ― 4,191,255, Stocks of less than a standard unit
Common stock (^) ― ― 824, Total shares issued 4,220,715,112 ― ―
Total voting rights held by all shareholders
Note: “Stocks of less than a standard unit” include 98 shares of treasury stock and 30 crossholding shares.
Crossholding stocks of less than a standard unit (As of September 30, 2020)
Shareholder Number of shares
Kai Nissan Motor Co., Ltd. 30
- Treasury stock, etc. (As of September 30, 2020)
Shareholders Addresses of shareholders
Number of shares held under own name
Number of shares held under the names of others
Total (^) interest% of
Shares Shares Shares % Treasury stock: Nissan Motor Co., Ltd.
2 Takara-cho, Kanagawa-ku, Yokohama- shi, Kanagawa 28,435,400^ ―^ 28,435,400^ 0. Crossholding stock: Kochi Nissan Prince Motor Sales Co., Ltd. 2-21 Asahi-cho, Kochi-shi, Kochi^ 105,600^ ―^ 105,600^ 0. Kai Nissan Motor Co., Ltd. 706 Kamiimai-cho, Kofu-shi, Yamanashi 37,800 51,600 89,400 0.
Kagawa Nissan Motor Co., Ltd. 1-1-8 Hanazono-cho, Takamatsu-shi,Kagawa 4,800 100 4,900 0.
Total 28,583,600 51,700 28,635,300 0.
Note: The shares included in “Number of shares held under the names of others” represents those held by Nissan’s crossholding share association (address: 1-1-1 Takashima, Nishi-ku, Yokohama-shi, Kanagawa). (Fractional numbers under 100 have been omitted.)
2. Members of the Board of Directors and Executive Officers Not applicable
1. Quarterly Consolidated Financial Statements
(1) Quarterly consolidated balance sheet
(Millions of yen) Prior Fiscal Year Current Second Quarter (As of March 31, 2020) (As of September 30, 2020) Assets Current assets Cash on hand and in banks 1,382,471 2,127, Trade notes and accounts receivable 356,156 381, Sales finance receivables 6,739,336 5,946, Securities 260,510 351, Merchandise and finished goods 881,940 661, Work in process 67,865 81, Raw materials and supplies 390,618 373, Other 739,307 691, Allowance for doubtful accounts (142,264) (190,418) Total current assets 10,675,939 10,423, Fixed assets Property, plant and equipment Buildings and structures, net 582,716 576, Machinery, equipment and vehicles, net ※ 1 2,936,316 ※ 1 2,688, Land 589,064 588, Construction in progress 227,165 215, Other, net 183,589 228, Total property, plant and equipment 4,518,850 4,297, Intangible fixed assets 114,932 110, Investments and other assets Investment securities 1,177,184 1,052, Other 493,689 572, Allowance for doubtful accounts (3,885) (3,909) Total investments and other assets 1,666,988 1,621, Total fixed assets 6,300,770 6,029, Deferred assets Bond issuance costs ― 7, Total deferred assets ― 7, Total assets 16,976,709 16,461,
(Millions of yen) Prior Fiscal Year Current Second Quarter (As of March 31, 2020) (As of September 30, 2020)
Liabilities
Current liabilities Trade notes and accounts payable 1,357,047 1,131, Short-term borrowings 1,339,949 994, Current portion of long-term borrowings 1,826,904 1,785, Commercial papers 726,017 325, Current portion of bonds 765,532 615, Lease obligations 35,572 40, Accrued expenses 1,031,284 933, Accrued warranty costs 104,297 95, Other 878,644 770, Total current liabilities 8,065,246 6,692, Long-term liabilities Bonds 1,042,954 1,969, Long-term borrowings 2,098,558 2,491, Lease obligations 72,494 74, Accrued warranty costs 108,751 91, Net defined benefit liability 454,068 455, Other 709,865 692, Total long-term liabilities 4,486,690 5,775, Total liabilities 12,551,936 12,467,
Net assets
Shareholders’ equity Common stock 605,814 605, Capital surplus 818,056 817, Retained earnings 4,125,043 3,748, Treasury stock (139,262) (139,285) Total shareholders’ equity 5,409,651 5,031, Accumulated other comprehensive income Unrealized holding gain and loss on securities (16,420) 14, Unrealized gain and loss from hedging instruments (20,352) (19,722) Adjustment for revaluation of the accounts of the consolidated subsidiaries based on general price level accounting
(35,632) (35,448)
Translation adjustments (1,046,160) (1,111,186) Remeasurements of defined benefit plans (226,798) (237,897) Total accumulated other comprehensive income (1,345,362) (1,389,764) Non-controlling interests 360,484 351, Total net assets 4,424,773 3,993,
Total liabilities and net assets 16,976,709 16,461,
Quarterly consolidated statement of comprehensive income
(Millions of yen) Six Months Ended September 30, 2019
Six Months Ended September 30, 2020 (From April 1, 2019 To September 30, 2019)
(From April 1, 2020 To September 30, 2020)
Net income(loss) 73,500 (324,895) Other comprehensive income Unrealized holding gain and loss on securities (12,495) 33, Unrealized gain and loss from hedging instruments (11,381) 773
Adjustment for revaluation of the accounts of the consolidated subsidiaries based on general price level accounting
(5,408) (22)
Translation adjustments (112,522) (30,378) Remeasurements of defined benefit plans 12,533 (11,694) The amount for equity method company portion (27,901) (39,771) Total other comprehensive income (157,174) (47,230) Comprehensive income (83,674) (372,125) (Breakdown of comprehensive income) Comprehensive income attributable to owners of parent (85,143) (374,361) Comprehensive income attributable to non-controlling interests 1,469^ 2,
The Three-Month Period Ended September 30 Quarterly consolidated statement of income (Millions of yen) Prior Second Quarter Current Second Quarter
(From July 1, 2019 To September 30, 2019)
(From July 1, 2020 To September 30, 2020)
Net sales 2,630,653 1,918,
Cost of sales 2,199,482 1,655,
Gross profit 431,171 263,
Selling, general and administrative expenses
Advertising expenses 70,523 58, Provision for warranty costs 31,925 19, Other selling expenses 50,736 19, Salaries and wages 100,890 86, Retirement benefit expenses 4,679 4, Provision for doubtful accounts 19,374 1, Other 123,045 77, Total selling, general and administrative expenses 401,172 267,
Operating income (loss) 29,999 (4,833)
Non-operating income
Interest income 6,167 2, Dividends income 38 1, Equity in earnings of affiliates 51,144 6, Derivative gain 1,778 301 Miscellaneous income 4,439 4, Total non-operating income 63,566 15,
Non-operating expenses
Interest expense 2,857 5, Exchange loss 5,585 1, Miscellaneous expenses 4,809 3, Total non-operating expenses 13,251 10,
Ordinary income 80,314 442
Special gains
Gain on sales of fixed assets 3,611 8, Other 3,009 872 Total special gains 6,620 9,
Special losses
Loss on sales of fixed assets 3,193 75 Loss on disposal of fixed assets 2,141 1, Special addition to retirement benefits 704 13, Other 3,052 10, Total special losses 9,090 25,
Income (loss) before income taxes 77,844 (16,333)
Income taxes 14,584 24,
Net income (loss) 63,260 (40,599)
Net income attributable to non-controlling interests 4,272 3,
Net income (loss) attributable to owners of parent 58,988 (44,370)