Thursday, July 22, 2010

Fiat returns to profit ahead of demerger

Fiat returns to profit ahead of demerger

Italian carmaker Fiat has returned to profit for the first time since 2008, as it prepares to spin off its non-car assets next year.

The group recorded a 113m euros ($145m; £95m) profit for the second quarter, against a 179m euros loss a year ago.

The encouraging result was driven by a turnaround at its car components division, which saw revenues jump 35%.

Fiat, which also produces tractors and trucks, plans to split into separate car and non-car businesses in January.

The results were well ahead of market expectations, and Fiat's share price jumped 6.5% when the Milan stock exchange opened on Wednesday.

The company also said it had raised its target for full-year profits.

Car sales

Net revenues for the quarter rose 12.5% on a year earlier, to 14.8bn euros.

However, this still remains well below pre-recession levels. Two years ago, revenues were 17bn euros.

The bulk of the Fiat Group's business is done by its carmaking division, which saw net revenues rise 7% to 7.9bn euros.

That included a big jump at Maserati - one of its two luxury car lines along with Ferrari - where net revenues were up 57% to 174m euros.

However, despite the increased business, the carmaker still suffered from falling market share, down to 7.5% from 9% in Europe, and down to 30.3% from 34.4% in its home market Italy.



DATED: 22.07.10

FEED: GG





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