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23/07/2008 | Wednesday 23rd July, 2008

Strong growth in 2008 first half results
Consolidated operating margin at 3.6% of sales
Net income climbs 49% at €733 million
Results in line with CAP 2010 program


  • Consolidated operating margin at 3.6% versus 2.7% in 2007 first half Recurring operating income continues to improve with a growth of 32.4% at €1,115 million, i.e. 3.6 % of sales. As in 2007, most of our improved earnings are down to the automobile division which confirms its recovery.
  • Sharp increase in net income: + 49% at €733 million
  • Generation of positive cash flow: €134 million
  • Automobile operating income up 58% at €633 million
  • Growth of 4.6% of worldwide vehicle sales and automobile sales of 1.4%
  • CAP 2010, the operations program focused on growth and competitiveness, a key asset for the Group in a tough economic climate.

PSA Peugeot Citroën sees the benefits of actions implemented through the CAP 2010 program, launched in 2007, and is well-positioned to rise to today’s challenges.

  • Cost reductions of €882 million generated by the competitiveness plan
  • A strong product drive

Successful launching of the Peugeot 308 and the new Citroën C5.

Launch-pace stepped-up: 10 new models in H1 2008, 9 planned in H2.




Group sales rose to €31,299 million, up 1.6% compared with 2007.

The automobile division stands at €24,502 million, up 1.4 %, thanks to the increase in the volume of vehicle sales and improved prices and product mix.

Banque PSA Finance sales, corresponding mainly to gross interest revenues on receivables, stand at €1,059 million, up 8.6%, the division benefiting from the 3.8% increase in total credits outstanding and its strong international growth.

At €1,904 million, Gefco sales have increased 6.0 %. This growth is supported by the 8.7% increase in business made with the PSA Peugeot Citroën Group, as well as the 1.7% rise in sales with third-party customers.

At €6,601 million, Faurecia sales are up 1.4 % on H1 2007. The first half-year was marked by steady business in Europe and high growth outside Europe, especially in North America, South America and Asia.


Group recurring operating income in H1 2008 stands at €1,115 million representing 3.6 % on sales, compared with €842 million and 2.7% of sales in H1 2007, i.e. an increase of 32.4%. The positive trend of the Group’s operating margin since H1 2007 continues.

Most of this increase comes from the automobile business with recurring operating income at €633 million, i.e. 2.6% of sales, compared with €400 million and 1.7 % of sales for H1 2007.
This 58% increase mainly comes from the positive impact of the CAP 2010 growth and competitiveness program: improved quality with a drop in warranty expenses, sharp cut in overheads and fixed costs, higher productivity. All in all, the action plans focused on competitiveness have contributed €882 million to the increase in recurring operating income and have managed to offset the accumulated negative impact of €461 million due to the inflation of
cost factors (raw materials, wages and forex) and R&D expenditure.

In a highly disruptive banking environment, the recurring operating income of Banque PSA Finance stands at €308 million, due to an excellent risk control.

The recurring operating income of Gefco at €79 million corresponds to 4.1 % of sales, compared with €76 million and 4.2 % of sales in H1 2007.

The recurring operating income of Faurecia has risen to €90 million and 1.4 % of sales, compared with €63 million and 1.0 % of sales in H1 2007.

Non-recurring operating income and expenditure constitutes a net charge of €86 million, compared with a net charge of €287 million in H1 2007.
These mainly include restructuring costs, of which 70% concern the automobile division and 30% Faurecia. These costs are mainly related to the voluntary redundancy plan. Unlike in 2007, there are no extraordinary asset impairments concerning the automobile division or Faurecia.
Peugeot SA net income has risen to €733 million, compared with €492 million in H1 2007. This results in an EPS of 3.21 euros, compared with 2.15 euros for H1 2007.

Net Financial Position

Cash flow generated by the industrial and commercial activities has reached €2,158 million, compared with €1,830 million in H1 2007. This positive trend is mainly related to the CAP 2010 actions plans focused on competitiveness.

Working capital requirements, however, for the industrial and commercial activities are up €417 million.

Capital expenditure of industrial and commercial activities has increased slightly to €1,022 million compared with €953 million in H1 2007.

As a result, the net financial position of the Group’s industrial and commercial companies at the end of June 2008 stands at €1,257 million compared with €1,404 million at December 31st, 2007.



In the difficult context of 2008, CAP 2010, the operations program launched in February 2007 and focused on growth and competitiveness, is a key asset for the Group.

The effects of the CAP 2010 momentum will intensify, especially by the reduction in overheads, warranty costs, production costs, purchasing expenses and by pressing on with the sales and product offensive. The Group will enjoy the full impact of its new introductions: 10 new models were launched during the first half-year; a further 9 will follow in the second half.

PSA Peugeot Citroën also holds some key assets in today's context. The Group's number one position on the low consumption and low CO²-emitting vehicles segment gives it an increasingly decisive competitive edge. Its LCV line-up, which is the most recent and the most complete in the Group's history, also confirms the Group’s leadership on this market in Europe.

The Group expects a slowdown in Western European markets for the full year 2008 of around 4% with a more difficult second half. On the other hand, in its priority growth regions, the Group is expecting at around 15% market growth over the year.
The impact of the increase in raw material costs compared with 2007 is expected to be between €300 million and €350 million. The pound sterling is expected to remain at around 0.80 GBP / €.

Under these conditions, the Group maintains its 2008 sales target for vehicles and CKD units between 3,550,000 and 3,650,000 units, i.e. growth of around 5%. It also confirms that it is aiming to achieve a 3.5% consolidated operating margin in 2008.

Press Relations : Investor Relations :
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The CAP 2010 momentum will have an even greater impact in 2008, especially through the reduction of overheads, warranty expenses, manufacturing and purchasing costs and the launching of a sales and product offensive.
In Western Europe, where the business environment is likely to see a slight decline in the automotive market, the Group expects to enjoy continued commercial success with the Peugeot 207and the Citroën C4 Picasso, and see a rising demand for the Peugeot 308 and other models launched in 2007. 2008 will witness a new phase in the Group’s range-rejuvenation strategy with the launching of the new Citroën C5, the extension of the 308 range, the launching of the Citroën Nemo and Peugeot Bipper and the new Citroën Berlingo and Peugeot Partner LUVs. Citroën also introduced a new organization in 2007 with Peugeot following suit at the beginning of 2008 to improve the performance of its sales teams.

In its strategic expansion regions (Eastern Europe, Mercosur, China and Russia) the Group forecasts double-digit market growth, slightly lower than 2007. Considering the extension of the Group’s model-range, PSA Peugeot Citroën should continue to enjoy profitable growth.

Under these conditions, the Group maintains its sales target of between 3 550 000 and 3 650 000 vehicles and CKD units in 2008, i.e. volume growth of around 5%. This growth should be stronger in the second-half of the year, considering the new vehicle launches scheduled.

Again, under these conditions, the Group is aiming to achieve a 3.5% consolidated operational margin.

These 2008 objectives are right on track with the CAP 2010 program.


(n° vehicles) H1 2007 H1 2008
Worldwide sales 1,764,100




(million euros) H1 2007 H1 2008
Automobile 24,169 24,502
Banque PSA Finance 975 1,059
Gefco 1,797 1,904
Faurecia 6,512 6,601
Other-activities and inter activity eliminations (2,635) (2,767)
Total PSA Peugeot Citroën 30,818 31,299



(million euros) H1 2007 H1 2008
Recurring operating income 842 1,115
Pre-tax income of Consolidated companies 551 959
Consolidated net income 483 731
Net income, Group share 492 733



(million euros) June 30th, 2007 June 30th, 2008
Cash flow* 1,830 2,158
Capex  (excl. R&D)* 953 1,022
Net financial position* 1,364 1,257
Equity 14,389 14,937

* of industrial and commercial companies


Employees under contract (worldwide) 209,300 206,900

H1 2008 consolidated accounts are available on



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