Good afternoon. Welcome to Nissan’s First Quarter 2024 Financial Results. Thank you for joining us. First, let me introduce the speakers for today. Mr. Makoto Uchida, President, Chief Executive Officer. Mr. Stephen Ma, Chief Financial Officer. In today’s agenda, we will begin with the presentation followed by Q&A session. CFO, Stephen Ma will cover the details of the results of the first quarter ending June 30th; and CEO, Uchida will present the outlook for the fiscal year. Now I’d like to turn it over to Mr. Ma.

Thank you, Lavanya. Good afternoon, everyone. We are announcing the results against challenging conditions and weaker performance in the first quarter. While the result is within our expectations, we are taking immediate actions to address the situation. I will describe it later. Our net revenue rose slightly to around ¥3 trillion. Our profit was adversely affected by several negative factors, which will be explained in later slides. Our operating profit was ¥1 billion and net income ¥28.6 billion. In the first quarter, total global retail sales were flat at 787,000 units. In China, retail sales rose by 3.3% and in Europe by 7.6%. In Japan, sales declined by 8% and in North America by 1.7%. In other markets, sales remain flat at roughly 120,000 units. As we adjust the supply to demand, global production fell by 7.5% to 784,000 units. This slide shows our key financial performance indicators. In the first three months of the year, consolidated net revenue was around ¥3 trillion and operating profit was ¥1 billion. Net income totaled ¥28.6 billion and we accelerated CapEx to ¥100.8 billion and R&D to ¥147.9 billion to ensure investment for our future in line with the Arc. Automotive business net revenue was up slightly at ¥2.68 trillion with an operating loss of ¥74 billion and auto free cash flow was negative at ¥302.8 billion. Net cash in the automotive business remained healthy at ¥1.4 trillion. Turning to our performance in key markets. In Japan, overall retail sales decreased by 8%. The Kei car segment saw a 3.7% increase driven by good performance of refreshed DAYZ and ROOX. Our supply caught up at the end of the quarter and order intake is improving. We see a steady recovery from Q2 onwards with the launch of new models and marketing initiatives. Models such as Serena e-POWER, Aura and DAYZ have shown a positive trend in sales. In North America, total industry volume growth was slower than expected. Nissan retail sales in North America decreased by 1.7% and in the U.S. by 3.1%. The decline in U.S. sales was primarily influenced by the impacts of delayed model year change over for Rogue and Sentra, aging products in some high margin segments, as well as the market’s movement towards hybrid vehicles. In Mexico, we retained number one sales position and fierce -- amid fierce competition from new entrants. Our commitment to quality was recognized in the JD Power 2024 Initial Quality Study with Murano and QX80 earning best-in-segment honors. Here is a little more detail on the U.S. situation. At the start of the fiscal year, we had to manage high inventory levels. The delayed changeover to model year ‘24 Rogue in Q4 resulted in increased incentive support to sell down the model year ‘23 vehicles, as many competitors` model year ‘24 vehicles were already selling in the market. After the strong tactics to promote the model year ‘23 Rogue sell down, we aimed to restore transaction prices and reduce incentives. However, softer than expected industry demand coupled with industry wide inventory and incentive increase, led to the elevated spending to keep competitiveness and manage our inventories. This situation will continue into Q2 as we are focused on improving inventory levels, as well as a good transition to the refreshed models in second half. We aim for a 20% normalization of our inventory during next few months with a more efficient use of incentives. Further, the introduction of new and refreshed models will help boost sales volume and ensure quality of sales. In Europe, retail sales rose to 79,000 units as we continue to out-perform the overall market. Customer orders are showing a positive trend, including for Qashqai and Juke, which is maintaining a strong sales momentum. The electrification mix stands at 49%, reflecting the strong demand for e-POWER variants, including the refreshed Qashqai e-POWER. Ariya is well received by our customers and continues to win awards, the latest being named Best Car for Long Distance by Auto Trader. In China, where we are reporting the results of the first half of the calendar year, competition from domestic brands remained intense. The total industry volume share of International passenger vehicle brands decreased by 15% year-over-year. By contrast, the Nissan brands performed well among International brands, declining only 2.3%. Despite intensifying competition, Sylphy maintained its top position in the ICE Passenger Vehicle segment during the first half of the year. The newly launched all-new Pathfinder has seen positive initial sales. Turning to the financial performance indicators for the first quarter. Net revenue increased by ¥80.7 billion. Operating profit decreased by ¥127.6 billion to ¥1 billion due to our performance in the U.S. and Japan, and net income decreased to ¥28.6 billion. Next slide shows the variance factors for the quarter. Foreign exchange had a positive impact of ¥23.7 billion, reflecting the strong dollar benefit net of other currency impacts. Raw material costs had a positive impact of ¥13.9 billion and sales performance had a negative impact of ¥110.4 billion, reflecting the intense competition and increased selling expenses, as mentioned previously. Monozukuri cost was managed efficiently and remained flat despite cost increases reabsorbed. Inflation had a negative impact of ¥27.1 billion, while other items such as sales finance, credit losses and remarketing expenses account for an additional ¥27.7 billion, as market is normalizing. Together, these factors reduced our operating profit for the quarter. Despite a challenging quarter, we have maintained our product momentum with a refreshed lineup. We presented a lineup of models including the Ariya NISMO, Kicks, Qashqai and QX80 and started sales of Note Aura in Japan, Juke in Europe and Pathfinder in China. Uchida-san will now explain the full year outlook.

Thank you very much. Given the challenges seen in the first quarter, we are revising our guidance for the full year. We expect unit sales to decrease slightly to 3.65 million units. Sales in China are forecast to decrease by 3.8%. Excluding China, we expect unit sales to be flat. Sales in Japan are likely to reach 500,000 units. In North America, forecast is 1.41 million units, a decrease of 1.4%. Sales in Europe will remain as per our earlier outlook with 385,000 units and other markets at 585,000 units. Production volumes are now forecast to be 3.45 million units. We are revising our forecast for the full fiscal year. As explained earlier, the measures to clear inventory and management of model year changes in the first quarter led to this revision. Revenues are expected to rise to ¥14 trillion. Operating profit is revised to ¥500 billion for the full year. This is ¥100 billion below our previous forecast. Net income guidance is adjusted accordingly to ¥300 billion. Capital investment of ¥620 billion and R&D spending of ¥665 billion remain at the same level as the previous guidance. With regards to forex, it’s $1, ¥155 yen. Euro is ¥167. That is the assumption that we revised to. This slide shows the variance factors behind our revised outlook. This includes a positive foreign exchange impact of ¥80 billion. But we expect this will be offset by ¥110 billion reduction in sales due mainly to increased selling expenses to reduce inventories in the second quarter. For the full year, we also anticipate ¥50 billion of other costs mainly linked to the used car price decrease. Taking all these factors into account, we have revised our operating profit forecast to ¥500 billion. In the remaining three quarters of the fiscal year, how do we forecast the operating profit? As CFO mentioned, we are on track to normalize inventories in Q2. In the previous year, our total profit between Q2 and Q4 was ¥440 billion. Though we -- in 2024, we continue to face inflation pressures and cost increase, we anticipate benefits from foreign exchange rates and 200,000 units of increased volume, thanks to the introduction of the new models. These factors should enable profit to recover to ¥500 billion. This has been a very challenging quarter for Nissan. A combination of corrective measures and new model launches will help drive our recovery. In the United States, we are introducing the Armada, Murano, INFINITI QX80. In Europe, we anticipate momentum with e-POWER variants of Qashqai, X-Trail, Juke, and Patrol in the Middle East. In Japan, good demand is expected for the Note, Sakura, Serena and DAYZ. We are working intensively to implement the Arc business plan, focusing on launching exciting new cars to the customers and speeding up our time to market while enhancing the efficiency and agility of the manufacturing operation. With these strategic actions, I am confident that Nissan will regain momentum. I thank you for your patience. I am now ready to address any questions you may have. A - Lavanya Wadgaonkar: Thank you, Uchida-san and Ma-san. We will now open for questions. Just a few item. Please raise your hand on Zoom, switch on your camera and microphone before you start asking questions. After the call you introduce your name and publication. Please keep one question per person. We now go to the first question from Otiya-san [ph] from Nikkei Shimbun. Otiya-san.

This is Otiya from Nikkei Shimbun. Thank you for taking my question. Okay. Thank you very much. So, in May, you made -- you forecasted the full year guidance and you made a big revision. Operating profit is reduced by 99% for the first quarter. Why? How come you see a big revision in such a short period of time? And inventories, incentives to control the inventories? Weren’t you too overly optimistic?

Yes. Thank you for the question. The results for Q1, as I explained, is due to the impact of U.S. operations. Initially, did we -- didn’t we anticipate these circumstances? Optimization of inventories in U.S., we knew that this would pressure our profit. In U.S., increase of inventories and demand declined and intensifying competition in the segments. Due to these factors, we were unable to boost volume as expected. In 2023, in Q4, retail volume fell short of our expectation and we had an old model year that we had to sell down. As a result, we had to spend additional incentives. These are the reasons behind it. On the other hand, affordable segment where Sentra belongs to, in this affordable segment, we are delivering good impact and we were able to gain share. But volume, if you look at U.S., the volume compared to the prior year, it’s almost flat. But Rogue, which is the key model, we couldn’t maintain the expected volume for Rogue and as a result, this pressured our profitability. This is one big reason. In Q1, because we haven’t completely optimized inventories, in Q2, we will -- including the adjustment of production, we will continue adjusting or optimizing the inventories. And as I said, the new upcoming models, we would like to take appropriate measures for the upcoming new models to be introduced. And as I mentioned, by introducing the new models as planned, we would like to achieve the sales volume and the profit that we are expecting. Thank you.

Okay. Understood. Thank you very much.

We now go to the second question from Murakami-san [ph], Nikkan Kogyo Shimbun. Murakami-san?

Nikkan Kogyo Shimbun. My name is Murakami. Thank you for taking my question. This downward revision, how confident are you to hit these numbers? The gap of the revision compared -- seems to be smaller than the decline that you suffered in Q1. It seems like you are kind of optimistic. What’s the probability of achieving the new numbers? How are you going to recover this? Uchida-san, this is a question for you.

Yes. Go back to the earlier slide, please. Various analysis for last year, the forecast slide. Yes. In the second half of the year, as I said, with the new model introduction, we expect to boost the volume, stabilize the profit and rejuvenate the lineup age. And as a result, we believe that we can achieve the plan. The most important factor here is U.S. Inventories in the U.S. should be optimized. This is the most important factor. In doing so, the upcoming new models like Kicks, as well as Rogue, minor change. With these introductions, we would like to boost the volume. And on top of it, the INFINITI QX80 will be introduced in July. And in North America, highly profitable high-end cars, for example, Murano, Armada. These are the new models which will be introduced in the second half of the year. By having these new models, as I mentioned, with new models, we expect the impact. Last year, we generate ¥440 billion. So by increasing 200,000 units, although we are impacted by inflation, this will be offset by forex benefit and generate ¥499 billion. This is achievable. This is feasible. And for volume, we made a revision on full year volume. In North America, we reduced that to 20,000 units and 30,000 units in China and 50,000 units in total. Model year 2024 adjustment on the inventories was made. So as a result, by introducing new models second half of the year, we have a feasibility to achieve the plan.

How about China?

In China, between June -- January and June, 339,000 units were sold, out of which, for example, new energy vehicle demand, ICE demand largely declined. But given these circumstances, we were able to be stable. We lost about 4,000 units compared to the prior year result. In the second half of the year, given the seasonality, we believe the TIV will grow. A minor change and the flagship SUV Pathfinder, thanks to these models, we are going to boost the volume. Therefore, in China, the JV brand market is largely declining year-on-year and in the intensifying competition, tough situation will remain in the second half of the year. But while keeping the result that we delivered in the first half of the year, by introducing new energy vehicles, we would like to grow our operation. So, in Q1, we made a downward revision, which is -- was a tough decision to make, but we will make sure that we achieve the new numbers. That’s very important. And this -- the -- this is the approach that we are taking as a result of the scrutiny. So we will do our best to achieve the new numbers.

Thank you.

We move on to the next question from UBS, Omeda-san [ph]. Omeda-san, please.

Yes. I would like to have a question about forex. Forex rate assumption is ¥155 to U.S. dollar. This is what you revised it today. It’s ¥152-ish. It’s -- the yen is appreciating, right? Lately, if you look at the forex, how do you assess the forex as of today and the volatility is so big. So including volatility, how do you foresee the forex? Thank you. That’s my question.

Then for the forex, well, of course, we will monitor carefully the forex, but I would like to ask CFO to speak about the approach that we are taking about the forex.

Sure. Thank you for the question. Obviously, when we made this revision estimate a few days ago, we -- the yen was still comfortably at ¥155. So I think the last day or two, we moved quite a bit. So, of course, as you mentioned before, each year movement does have some impact to us. There’s both positive and negative. So we’re going to keep that very much into consideration. Going forward, obviously, as we said before, we prefer more stable and less volatility. But if the interest rate changed quite a bit, then it could change and then we will, of course, see how things go and update as necessary. But currently, we do think even with the ¥153 or ¥154 or ¥152, I think right now, is still achievable with this current estimate. We do have enough room to still manage with this level. So I think that’s your question mainly. Does that answer? Thank you.

Thank you.

Yeah. We move on to the next question is from Asahi Shimbun, Nishiyama-san [ph]. Nishiyama-san, please.

Thank you very much, Nishiyama, Asahi Newspaper. From my part, I have a question regarding the situation in China. The car market in China, particularly for sales of Japanese cars, Nippon Steel has decide -- is going to reduce the steel production in China and also there is a uncertainty involving other suppliers as well and other manufacturers as well in China. They are considering restructuring production capacity in China. Now, for Nissan, regarding the growth potential of Chinese market, what is your view and in line with the assessment, the recently closed Chaozhou factory, is there any more possibility of closing factories in addition?

Thank you very much for your question. Regarding Chinese market, it is very challenging situation currently. Last year, I talked about this briefly, but local OEMs, NEV cars are being launched. Every three months, they are increasing the launches of new vehicles, new energy vehicles, I mean. And also, as I showed you earlier, on that part, we are fighting as international brands, TIV for international brands. Unfortunately, it has come down by 15% year-on-year and selling price is still struggling. We are having excessive competition. So, we have heard those news you mentioned. Now, going forward in China, how are you going to address this market? Now, on our part as Nissan, we -- our Nissan customers, we have about 7 million customers there. And in such a situation, ICE cars demand is still high. Therefore, we are going to deliver Nissan brands to our customers. As we mentioned earlier, Beijing Motor Show, we announced four NEV cars. So, we are going to launch these new energy vehicles definitely. However, we cannot be optimistic. There are a lot of uncertainty and lack of transparency in the market. Therefore, the fixed cost has to be optimized. We are having a good discussion with our partners in order to reduce fixed costs. Now, on this front, we have to watch the situation closely, and every three months, I visit China. So, I have good discussion with our partners there in China and the momentum of Nissan ICE gasoline cars and we like to create this momentum for the launch of new cars. Now, we are going to maintain the current momentum. That is what we can do now. However, going forward, locally developed and locally produced NEVs, they are going to lead to the growth of our company in China. And we are going to do that thoroughly together with our partners there. Now, in such a situation, the market situation is changing very, very rapidly, in China particularly. Therefore, we have to align our company business to the current market situation. I think that is the best way to express our view. So, going forward, I cannot definitely say that we are okay in the Chinese market, but at least we would like to deliver our Nissan brand’s value to our customers there. That is what we would like to achieve in the latter half of the year.

Thank you so much.

We will move on to the next question from Toyokasei, Heather-san [ph]. Heather-san, please? Heather-san, Toyokasei. Can you hear us?

Your microphone is on mute. We do not hear you, but do you hear us?

Heather-san, can you switch on your mic, please?

Yes. Hello.

Okay. We do hear you now.

Thank you. Okay. Good. Excuse me. U.S. operation, why isn’t the profit good? Up till today, if you look at the incentive, Ariya, Altima, Sentra, in one year, you have increased largely the spending. It is much higher than the competitors now. I am talking about incentives. Because of the reflection of the past, you have been controlling the incentive in the U.S., but now, why is it sharply increasing? And hybrid, there is a shift of demand to hybrid, and Nissan does not have a hybrid in the lineup. Maybe this is one of the reasons, but you have e-POWER. Do you have a plan to introduce e-POWER in the early stage?

Incentive, policy on the incentive. We are at the industrial average when it comes to incentive spending. In order to maintain quality of sales, most of the incentives are allocated for rather than cash, but subsidy for the loan of the customers. Sales fin -- this will go through the sales financing and captive finance. This is how we are protecting the residual value. So, rather than cash incentive, we are allocating the spending to help the loan of the customers so that we can maintain a certain level of resale value. So, it is not that we are spending cash incentive. That is how we are using the incentive as of today. And by model, yes, as you said, Rogue, for Rogue. Because of the switchover of the model year, we spend additional incentive. That is a fact, but the rest. As I mentioned, affordable model, Sentra, Kicks, as well as the Altima, which is on top. For these models, we are making sure that we are gradually increasing the shares. So, what are successful? By taking necessary measures, affordable models, market share and segment share are increasing month-over-month between April and June. But what is not working is the switchover of the model year, which is Rogue, where we see an increase in the inventories and 2024 model year transition, where we were unable to boost the volume as expected. If you look at Rogue alone, in Q4 of last year, we sold 90,000 units or close to 90,000 units. But for Q1, it came down to 50,000 units. So, these are largely impacting the profitability of Nissan and resulted in additional incentive standing. And as a -- and we are unable to optimize inventories yet. So, in the first half, throughout the first half, optimizing the inventories will make us ready for the upcoming new model introduction. So, we have to do this right. This is the immediate challenge. You mentioned earlier hybrid. We don’t have a hybrid. As I said in the Arc business plan, plug-in hybrid is under discussion. We cannot tell you when, but we have a plan to reinforce our lineup in North America. Thank you.

Thank you. Understood.

The next question is from Mukoyam-san, Yomiuri Shimbun.

Yes. This is Mukoyam from Yomiuri Shimbun. Yes, do you hear me?

Yes, we do.

My question is as follows. The government in May, SDV, next-generation strategy was built. This new strategy is demonstrated by the government. So, SDV, especially software aspect and the OS commonization, what is your approach to this domain? You are doing a feasibility study of the partnership with Honda today and some -- where OS-Honda -- do you have a -- we heard that you apply -- you have a consideration of commonization OS with Honda. What is your approach here?

With regards to the feasibility study with Honda, I would like to do communication when we are ready. So, I would not touch upon it today. But as you indicated, this domain, auto industry, this is my personal insight as well. In the future, we want to provide various services to the customers. So, we would like to align the specifications in the areas where we can collaborate. This is the industrial approach because this will help optimize the entire operation. Each OEM, for example, at Nissan, it’s about the long-distance future as we showed in the Japan Mobility Show. In order to realize the concept cars with software aspect and the platform, these domains should be worked on. And Chinese makes are putting a lot of efforts in this domain. So, in one sense, this will be more than what we imagine. This is what the customers will look for much faster than we anticipate. So, we should be ready. That’s the direction that we are pursuing. Excuse me, it sounds fuzzy, but that’s what I can say today.

Thank you.

As we are coming to the end of the session, we’d like to take just one last question. It is from NHK, OB-san [ph]. OB-san, please.

Hello. NHK, OB is speaking.

Yes. Go ahead.

Do you hear me?

Yes. We do. Go ahead.

Okay. Thank you for taking my question. This is related to the earlier question. Feasibility study with Honda, this is under discussion. That’s what I understand. Where are you today with this negotiation? And Uchida-san, you are also involved in the discussion, I believe. So, how are you discussing to collaborate? And the first, when will you communicate the first round? What’s the feasibility to the extent that you can disclose?

As I said, back in March, on March 15th with it, we made a joint press conference with Mibe-san. Onboard software platform, battery EV related core components, these are what we talked about and the product complementarity. These are the areas that we are discussing with Honda. Concrete, we are in the stage of concrete discussion in terms of progress. Contents-wise, when the time comes, we will be ready to communicate. Last time, we said that it will come around summer. It’s already summer. So, it’s very difficult to explain. But around summer, as I said, that’s a feasibility. So, for progress, the top executives of the both companies are involved in discussion and all the Genba people are also involved in the serious discussion. And we are discovering the strength of each other and exploring the variety of possibilities of collaboration. So, the discussion is deepening between the two companies. Therefore, my impression is as follows. It has been four months plus since March. We are making good progress so far. So, we would like to create an occasion where we can communicate about it when we are ready. Thank you.

Thank you.

With that, we will conclude today’s session. Thank you, Uchida-san. Thank you, Ma-san. Once again, thank you for joining us. If you have any further questions, please do direct it to Nissan Communications team. Have a good day.