23.07.2008 12:08 Fiat Q2 net, trading profit up on strong auto, lorry, CNH ops; reiterates FY tgt
MILAN (Thomson Financial) - Fiat SpA (News/Aktienkurs) said its second quarter net and trading profits rose, supported by stronger operations at its auto, lorry and heavy machinery unit CNH Global NV (News), adding it reiterated full year targets.
Net profit rose to 604 million euros from 593 million a year earlier and trading profit was up to 1.131 billion, from 946 million, including Fiat Auto trading profit at 243 million from 193 million, it said.
The results are in line with analyst expectations, while group trading profit, or operating profit before exceptional items, is higher than expected.
'The positive results reached in the first half, and in particular in the second quarter ... are a solid base for the group's commitment to increase sales and margins in the period 2008 to 2010,' Fiat said.
'The group enters the second half of 2008 with a clear perception of uncertainties and risks associated with weak world markets,' it said.
Further risks come from higher raw material prices, particularly steel, plastics and rubber, that have a significant impact on components costs.
All the same, Fiat said it reiterated its full year 2008 targets for sales of around 63 billion euros, trading profit of 3.4 billion to 3.6 billion, net profit of 2.4 billion to 2.6 billion, and EPS of 1.90 to 2.00 euros.
'This declaration is based on continuing strength in south American markets, resistance in price levels and demand for agricultural products, a 3 percent fall in the European car market, and a substantially stable market for lorries,' it said.
'The group believes it highly improbable that future falls will exceed its estimates,' it said.
For 2009, Fiat said it reiterated targets, seeing sales of about 65 billion euros and trading profit of 4.3 billion to 4.5 billion.
Fiat said its recommitment to 2008 and 2009 comes after implementing efficiency actions to take account of weak economic conditions.
In the second quarter, group sales rose 11.8 percent to 16.967 billion euros from 15.179 billion, while Fiat Auto sales were 7.770 billion, up 14.6 percent from 6.782 billion, it said.
Net debt at the industrial operations at the end of June was 510 million euros, down from 1.107 billion at end-March.
Analysts polled by Thomson Financial News expected net profit between 594 million to 660 million euros, trading profit 1.000 billion to 1.090 billion, and sales of 16.2 billion to 16.5 billion.
Net industrial debt was seen at 300 million to 800 million euros.
For the Fiat Auto unit, analysts expected trading profit of 210 million to 260 million euros and sales of 7.2 billion to 7.4 billion.
nigel.tutt@thomsonreuters.com
nt/cmr
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