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29/07/2015 | Paris
  • Group revenue of €28,904 million
  • Recurring operating income of €1,424 million, up €1,037 million1
  • Recurring operating income from the Automotive Division of €975 million, up €968 million1
  • Free cash flow of €2,792 million

“Our first-half results are very positive but we need to review them on a full-year basis,” said Carlos Tavares, Chairman of the PSA Peugeot Citroën Managing Board. "In this unstable international environment, the company and its staff – whom I thank wholeheartedly – must all be focused on the full execution of the “Back in the Race” plan in order to secure the Group's recovery."

Consolidated net revenue represented €28,904 million in the first half of 2015, up 6.9% vs 2014. The Automotive Division reported revenue of €19,409 million, a year-on-year rise of 4.3% driven by the increase in net prices, a positive product mix and a favourable currency impact.

Consolidated Recurring Operating Income amounted to €1,424 million, versus €387 million in first-half 2014. Most of the growth came from the Automotive Division, with a €968 million improvement due to a favourable business environment contributing for nearly a third, and the combined impact of cost saving and positive product mix effects - reflecting the success of recent vehicle launches and the pricing power policy.

The Automotive Division's pro forma recurring operating income, which includes 50% of the results of Chinese joint ventures, was up €1,065 million1 to €1,193 million.

Non-recurring operating income and expenses resulted in a net expense of €342 million in the first half of the year, primarily due to restructuring costs incurred by the Automotive Division.

Financial income and expenses represented a net expense of €336 million compared with €344 million in first-half 2014.

Net income for the period came to €720 million, up €762 million year-on-year.

Banque PSA Finance reported recurring operating income of €294 million2 a rise of €122 million on first-half 2014. Further to the February 2015 agreement with Santander Consumer Finance, two joint ventures – one in France, the other in the United Kingdom – are already operational. As a result, the Group is benefiting from some of the most competitive refinancing conditions in the market.

Faurecia's recurring operating income amounted to €424 million, a year-on-year increase of 36.3%.

Free cash flow  of manufacturing and sales companies  amounted to €2,792 million, driven by an improvement in the cash flow from operations, seasonal changes in working capital requirement (up €932 million over the period due to high production in Europe in May-June 2015) and dividends paid from DPCA and Banque PSA Finance during the first half.

Excluding  €321 million restructuring expenses and €331 million exceptional income, operating free cash flow for the period came to €2,782 million.

Total inventory at end-June 2015, including independent dealers, stood at 391,000 vehicles, 16,000 fewer than at end-June 2014.

The manufacturing and sales companies’ net financial position at 30 June 2015 was a positive €3,562 million, up €3,014 million vs 31 December 2014. Aside from free cash flow generation, the improvement was notably attributable to the exercise of stock warrants for a total of €120 million.

Market Outlook
In 2015 the Group expects automotive demand to expand by 6% in Europe and approximately 3% in China but to contract by around 15% in Latin America and 35% in Russia.

Operational Outlook
The Group aims to generate operating free cash flow of around €2 billion over the period 2015-2017. It is also targeting an operating margin3 of 2% in 2018 for the Automotive division, with the objective of reaching 5% over the period of the next medium-term plan, covering 2019-2023.

1 on first-half 2014, restated following the application of IFRS 5
2 100% of the results of Banque PSA Finance. In the financial statements of PSA Peugeot Citroën , the two joint ventures are consolidated at equity, and the other businesses covered by the Santander agreement are declassified under ‘Net result from operationsto be continued in partnership’.
3 Recurring operating income relating to the Automotive Division’s revenue


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