Renault reports profit, shares jump

French automaker Renault reported today a 15.3-percent drop in net profit to 1.77 billion euros last year of which nearly half came from a gain on the sale of a stake in Swedish group AB Volvo.

Renault's results were far stronger than those of crisis-stricken PSA Peugeot Citroen which has reported a 2012 loss of 5.0 billion euros owing mainly to writedowns to reflect weakness in the French auto market.

The price of shares in Renault jumped by 6.47 percent in early trading to 45.98 euros, with traders welcoming the profit outcome and positive comments by the company for its finances this year.

The capital gain from the stake in AB Volvo was 924 million euros.

Renault was also boosted by results at its associated companies, Nissan of Japan and Avtovaz of Russia, as well as Volvo. These contributions amounted to 1.5 billion euros, the same as in 2011.

Sales fell by 3.2 percent to 41 billion euros.

Renault said that it had cleared its debts and had a net positive cash position of 1.49 billion euros at the end of 2012.

Renault, which also sells under the brands of Dacia and Samsung Motors, does about half of its business outside France and is less dependent that Peugeot on the European market which is depressed.

Renault chief executive Carlos Ghosn said in a statement: "In Europe, in a very difficult context, particularly in France, the group kept to a rigorous commercial policy and began to renew its range (of vehicles."

Operating profit amounted to 122 million euros from 1.2 billion euros in 2011. The company had to make writedowns owing to the fall of the Iranian currency and for restructuring charges.

Cash flow for the auto division was positive for the fourth year running, at 597 million euros.

The company, which intends to pay a dividend of 1.72 euros per share, has set a target of raising sales this year

... contd.

Please read our terms of use before posting comments
TERMS OF USE: The views, opinions and comments posted are your, and are not endorsed by this website. You shall be solely responsible for the comment posted here. The website reserves the right to delete, reject, or otherwise remove any views, opinions and comments posted or part thereof. You shall ensure that the comment is not inflammatory, abusive, derogatory, defamatory &/or obscene, or contain pornographic matter and/or does not constitute hate mail, or violate privacy of any person (s) or breach confidentiality or otherwise is illegal, immoral or contrary to public policy. Nor should it contain anything infringing copyright &/or intellectual property rights of any person(s).
comments powered by Disqus