Nissan 2007 Annual Report Download - page 6

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Nissan Annual Report 2006-2007
4
As for purchasing, the Alliance has supported our
breakthrough to develop new supply sources in
“Leading Competitive Countries,” especially in
Eastern Europe. We will also accelerate progress in
India with the Alliance.
There are still more areas of cooperation that
have yet to be realized.
Outlook
In fiscal year 2007, we will launch 11 new products
globally. The most important of these introductions
will be the five models for the U.S. We will launch an
all-new version of the Altima coupe, an all-new
version of the Infiniti G37 coupe, the all-new
compact crossover Rogue, the new compact luxury
crossover Infiniti EX, and an all-new version of the
Murano. Although we will again face a challenging
environment, I believe that we will get back on track
in terms of profit growth with these new models.
Long-term value creation
Despite our commitment to long-term value creation,
in recent years, our market-adjusted total return to
shareholders has been negative. In addition, our key
valuation multiples, including PER, have been lower
than our main competitors. Of course, multiples are
only rough estimates and the differences may be
attributed to various factors, including accounting
differences. However, given the size of this gap to
our competitors, it’s obvious that the market is
discounting the value of Nissan.
Based on our analysis, a significant part of this
gap is due to investor perceptions regarding our
long-term performance. To a lesser extent, our
recent short-term performance has also contributed
to this gap. Since the two perceptions are strongly
interrelated, our weak short-term performance has
negatively influenced perceptions regarding the
viability of our long-term performance.
In order to close this gap, we must first deliver strong
short-term results. And we must do this without
being short-term oriented because the market
always rewards companies that perform over the
long-term. When we can demonstrate strong short-
term performance, the long-term performance
perceptions should improve. What will close it is
consistently delivering strong short-term results.
Of course, we will not stop there. We will further
improve perceptions of our long-term potential via
transparent investor communications. After we
successfully put ourselves on a solid track of
profitable growth, investors’ desires for more
transparency increased significantly. They want to
know more about our future strategy and vision and
have a better understanding of how we will deliver
our plans.
Performance and transparency make for
credibility and that is what it takes to convince the
market of our future potential. In this uncertain
business environment, a company is required to not
only consistently deliver strong performance, but also
communicate to the market in a transparent manner.
A company cannot completely avoid all the ups
and downs in its performance. But it should learn
from past mistakes and never make them twice; this
behavior is part of Nissan’s DNA. We are committed
to gaining the trust of the market and delivering
superior performance.
Carlos Ghosn
President and Chief Executive Officer