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Fiat 2011 earnings double as Chrysler posts first profit since 1997, Ferrari growth
MILAN (AP) ' Fiat Group SpA, the Italian automaker which controls Chrysler, on Wednesday reported that full-year earnings more than doubled ' beating expectations ' thanks to Chrysler, which posted its first profit since 1997.
The net profit, attributable to the parent company, rose to euro1.3 billion ($1.71 billion) from euro520 million a year earlier, while revenue rose 66 percent to euro59.5 billion.
The results exceeded the company's guidance. The trading profit ' or earnings before interest, taxes and one-time items ' was euro2.3 billion ($3.03 billion), compared with the target of more than euro2.1 billion ($2.77 billion).
Shares in the company rose 6 percent to euro4.86 in Milan after the publication of the results.
In a call with Chrysler analysts, Fiat and Chrysler CEO Sergio Marchionne said that all of Fiat's net income came from Chrysler last year.
Fiat Group Autos, which comprises the Fiat, Lancia and Alfa Romeo brands, saw annual vehicle shipments slip 2.4 percent to 2 million, due largely to declining European sales, whereas Chrysler sales jumped 22 percent.
Marchionne has been trying to make Fiat plants more efficient, demanding new work rules in several sites in Italy. He has cited Fiat's inward-looking business model as a main cause of losses in the early 2000s, before he was brought in to turn it around.
"Somebody better get off their butts and snap on to the grid. We're not pulling the cart here," Marchionne said. "Being European doesn't entitle them to be economically inefficient."
Fiat, which controls 58.5 percent of Chrysler LLC, has consolidated results with the U.S. automaker since June. Without Chrysler, Fiat said it broke even for the year.
Chrysler sold 1.85 million vehicles last year, thanks to higher demand for Jeeps and revamped model lines under the Fiat partnership.
Fiat is counting on the U.S. company's continued strength. It forecast 2012 revenues of euro77 billion and net profit of euro1.2 to euro1.5 billion.
In the fourth quarter, Fiat's net profit attributable to the parent was euro43 million, down from euro139 million a year earlier, reflecting its less-than-full control of Chrysler and Ferrari, at 90 percent.
Quarterly revenue more than doubled to euro19.6 billion, but was flat without Chrysler's contribution.
In Fiat Group Autos, an increase of light commercial vehicle volumes failed to offset lower passenger car shipments, which declined 4.6 percent to 1.6 million, as demand in Fiat's domestic Italian market shrank significantly. Demand grew in Brazil, however, by 1.5 percent to 772,700 vehicles.
Ferrari, however, hit a record volume of 7,195 vehicles, a 10 percent increase over 2011, driven by sales of 12-cylinder models. Revenues at Ferrari rose 17 percent to euro2.25 billion, while Maserati revenues hit euro588 million on volumes of 6,159 vehicles.
Net industrial debt, which stood at euro5.5 billion at the end of 2011, is forecast to remain flat or grow to euro6 billion.
Fiat has proposed a dividend to preference and savings classes of shareholders, not to ordinary shareholders.
Tom Krisher in Detroit contributed to this report.