Fiat Group (FIATY.PK) Monday reported a decline in profit for the first quarter, hurt mainly by weak demand at Europe and U.S, and as well as higher costs on new models launch. Looking ahead, the Italian car giant maintained its financial outlook for the full-year 2013 despite the bleak prospects in European markets.
Turin, Italy-based Fiat's trading profit, earnings before taxes, interests and special items, for the quarter dropped to 618 million euros from 806 million euros a year ago. Fiat said the drop reflects the 200 million euros decrease in NAFTA region due to lower shipment volumes, as well as higher industrial costs resulting from new launches.
Fiat's revenues for the quarter dropped 2 percent to 19.76 billion euros from 20.22 billion euros last year. Nevertheless, revenues were flat at constant exchange rates.
Revenue growth at Latin America regions, Asia Pacific and Luxury brands were offset by poor performance at North America and Europe. North American region dropped 3 percent to 10 billion euros and EMEA slipped 4 percent to 4.4 billion euros. On the positive side, Latin America region revenues grew 6 percent at constant exchange rate while Asia Pacific rose more than 35 percent to 1 billion euros. Luxury and performance brands were up 4 percent to 0.7 billion euros, driven by Ferrari.
For Fiat excluding Chrysler, the net loss narrowed to 41 million euros from 235 million euros last year. Fiat Group took control of Chrysler under a U.S. government-brokered bailout deal in 2009, and in early January 2012 raised its stake in the U.S. car maker to 58.5 percent in several tranches from the initial 20 percent it initially held. Chrysler's results were consolidated by Fiat Group since June 2011.
Chrysler Group's profit for the first quarter dropped 65 percent to $166 million from a year ago. Profit for the period was negatively impacted by reduced vehicle shipments that resulted from key product launches, namely the 2013 Ram Heavy Duty trucks and the 2014 Jeep Grand Cherokee, as well as preparation for the second-quarter production launch of the all-new 2014 Jeep Cherokee.
First-quarter loss attributable to owners of the parent was 83 million euros, compared to a profit of 35 million euros last year. Net profit for the quarter declined to 31 million euros from 262 million euros in the year ago quarter.
Looking ahead to fiscal 2013, the company confirmed its financial guidance. The company still anticipates net profit of 1.2 billion to 1.5 billion euros, trading profit of 4.0 billion to 4.5 billion euros, and revenues of 88 billion to 92 billion euros.
On the OTC markets, FIATY is trading at $6.06.
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