Fiat Q4 profit up 29% helped by narrower Europe loss
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MILAN (Bloomberg) -- Fiat today reported a 29 percent gain in fourth-quarter profit, boosted by record sales of Jeep models and a narrower loss in Europe.
Trading profit, or earnings before interest, taxes and one-time items, advanced to 987 million euros ($1.34 billion) from 765 million euros a year earlier, the company said.
Fiat reduced its fourth-quarter loss in Europe to 165 million euros from a 289 million euro loss in the last quarter of 2011.
CEO Sergio Marchionne said he doesn't expect further deterioration in Fiat's performance in Europe this year, after losing 738 million euros in 2012, in line with its forecast. (For full Fiat results click here.)
"In Europe, the situation won't be drastically different in 2013," Marchionne said prior to the earnings release. "We are working at the speed of light" to meet the company's target of breaking even in the region by 2016 at the latest.
Fiat has decided not to recommend a dividend for 2012 to maintain its liquidity. Net industrial debt at the end of the year was 6.55 billion euros.
The need for a turnaround in Europe was underscored after Fiat-unit Chrysler Group today cut its forecast for free cashflow for 2014 to $1 billion from $3 billion. The U.S. carmaker reported a 68 percent jump in fourth-quarter net income to $378 million.
Fiat wants to fix its European business before finalizing a planned merger with Chrysler, which the Italian company controls through a 58.5 percent holding. The turnaround plan in Europe, where auto demand is in the midst of a six-year contraction, calls for 16 upscale cars, including an Alfa Romeo SUV, a small Jeep and six models at the luxury Maserati division, to fill under-used assembly lines in Italy.
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