First quarter 2012 Group revenues
- First-quarter 2012 Group revenues of €14.3 billion, down 7% compared with the previous year.
- Automotive Division revenues down 14% year-on-year: 8% contraction in the European market compared to first-quarter 2011 which benefited from increase in registrations ahead of the scrappage incentives withdrawal and sustained pricing pressure.
- Strong revenue growth at Faurecia, up 8%, and Banque PSA Finance, up 6%.
- Modest decrease at Gefco, down 4%.
- Global alliance with GM underway. Success of €1 billion capital increase.
- Peugeot 208 launched on 29 March.
- Asset sales: Citer sold for €448 million and signature of an agreement for sale of the Paris headquarters building for €245 million.
- €1 billion cost reduction action plans on going.
- €600 million bond issue and €700 million in LTRO financing obtained by Banque PSA Finance.
Outlook for 2012
Group revenues for first-quarter 2012 were down 7% compared with the same period of 2011, which was lifted by the increase in registrations ahead of the withdrawal of scrappage incentives.
The competitive environment remained difficult during the quarter, with pricing pressure similar to the last quarter of 2011 and markets in Southern Europe worsened considerably, with an unfavourable impact on the Group's country mix. This environment should last throughout the first half of the year.
In 2012, the Group continues to expect the Europe 30 market to contract by c.5% and by c.10% in France. Outside Europe, the Group is anticipating growth of c.7% in China, c.6% in Latin America and c.5% in Russia.
In this tough environment, the Group net debt should reduce significantly, supported by the cost reduction plan and the cash management program, by asset disposals and the new model launches.
The €1 billion cost reduction plan is in the process of being implemented. Nearly half of the €1.5 billion asset disposal plan had been completed during the first-quarter, with the sale of Citer for €448 million and the signature of an agreement for sale for the Paris headquarters building for €245 million.
The first key milestones in the global strategic alliance set up with GM on 29 February 2012 were attained during the quarter, with the creation of the Steering Committee on 26 March, the successful €1 billion share issue on 27 March and negotiations for the logistics agreement on going.
Automotive Division revenues decreased by 14% in the first quarter of 2012 to €9,719 million from €11,262 million in the first quarter 2011 which was lifted by the increase in registrations ahead of the withdrawal of scrappage incentives. Worldwide sales totalled 790,100 vehicles, down 14.2%, with sales of assembled vehicles 15.1% lower at 691,500 units. The decrease reflected sharp contractions in Europe and Latin America, partly offset by higher unit sales in Russia and China.
Revenues from new vehicle sales amounted to €6,978 million compared with €8,399 million in first-quarter 2011. The 16.9% decrease was attributable to several factors:
- Assembled vehicle volumes fell by 18.1% excluding China, reflecting an unfavourable country mix and erosion of market share in Europe in the first quarter.
- The price effect was a negative 0.9%, as price pressure remained similar to that experienced in the second half of 2011 with additional product enrichment.
- Other effects represented a negative 1.4%, mainly corresponding to lower CKD sales.
These adverse factors were partially offset by a further 3.3% improvement in the product mix, on top of a strong effect in the first quarter of 2011. The improvement was driven mainly by recent launches (Citroën DS4, DS5, Peugeot 508, SW, RXH, 3008 HYbrid4) and by the success of the premium models which now account for 18% of sales.
New vehicle inventory at 31 March represents 70 days' sales. The Group confirms its objective of reaching 2010 inventories levels in June and in December 2012, with a consolidated DSI ratio of 61 days at the end of the year compared with 69 days at 31 December 2011, and 72 days at 30 June versus 76 days at end-June 2011.
European automotive markets contracted sharply by 8% in the first quarter.
Markets in Western Europe were down by 8.5%, with wide variations by country. Markets in Southern Europe collapsed, with falls of 19.4% in France, 22.4% in Italy and 4.3% in Spain. The Group is heavily exposed to these markets, which account for 56% of its European sales. The United Kingdom market contracted by 0.7%, while the German market grew by 1.2%.
In Central and Eastern Europe, markets rose by 1.8% overall during the quarter.
In light of the persistently unfavourable market mix for the Group and pent-up demand in the A and B segments ahead of the Peugeot 208's launch at the end of the quarter, Group market share remained stable compared with fourth-quarter 2011 at 12.9%. Excluding the effect of the changes in country mix, market share in the first quarter would have stood at 13.5%.
PSA Peugeot Citroën maintained its leadership in a light commercial vehicle market down 11% over the quarter, with a 21.1% share at the end of March.
In a slightly slower market in the first quarter, based on invoices, the Group increased its market share to 3.6% with volumes up 6.3%. Growth was led by the successful launch of the Peugeot 308 and 508, and by the development of the dealer networks. DPCA will expand its model line-up in 2012 with the addition of two C segment vehicles.
The Russian market continued to improve, growing by 18% in the first quarter. The Group's sales in this country rose 23% and its market share widened to 3% at end-March, reflecting the launches of the Peugeot 508 and the Citroën DS4 and a 79% gain in the light commercial vehicles segment. Four other models will be launched in 2012.
Markets in Latin America softened, with overall growth slipping to just 2% and the Brazilian market down 1%. The Group's unit sales fell by 25% during the quarter as a result of the market slowdown and technical problems that delayed the restarting of production at Porto Real following work to increase capacity. At the end of March, the Group's market share stood at 5.1% compared with 6% a year earlier. The Peugeot 308 was introduced to the market in the first quarter and the launch of five other new models will also help refresh the line-up.
CKD sales totalled 98,600 units, a decrease of 8%. This was mainly due to the suspension of CKD sales in Iran since February, following tighter international sanctions which resulted in payments stopping due to financing difficulties.
In all of its developing areas, PSA Peugeot Citroën's marketing strategy is designed to move the Peugeot and Citroën brands upmarket. This process continued apace in the first quarter, with premium models accounting for 18% of Group sales, versus 16% in the same period of 2011. The trend will continue with the ramp-up of deliveries of the DS5, the introduction of two SUVs in the C segment, the Peugeot 4008 and the Citroën C4 Aircross, and the launch of four diesel hybrid models (Peugeot 3008 HYbrid4, 508 RXH, 508 HYbrid4 and Citroën DS5 HYbrid4) that underscore the Group's technological advance.
The launch of the 208 on 29 March has brought the Peugeot brand's style code to a new generation and revamped the B segment line-up with a vehicle that is 110 kg lighter than the Peugeot 207, and offers fuel consumption of 3.4 litres per 100 km with CO2 emissions of just 87g per km.
Faurecia reported revenues of €4,297 million for the first quarter of 2012, an increase of 8%. Revenues dipped 2% in Europe but increased in all other regions, with gains of 39.5% in North America, 1.4% in South America and 23.6% in Asia. Revenues from product sales were up 8% at €3,353 million. Across the business base, automotive seats gained 7%, interior systems 9% and emissions control technologies 15%, while automotive exteriors contracted by 3%.
Gefco's revenues totalled €935 million for the quarter, down 4% due to lower volumes in Europe. Gefco is accelerating its growth generated by third parties.
Banque PSA Finance
Banque PSA Finance's revenues rose by 6% to €496 million in the first quarter. The loan book increased by 1% to €24.2 billion. A total of 210,000 new loans were originated, a decrease of 8% due to the slowdown in vehicle sales in Europe over the period partially offset by an increase in market share.