PSA Revenue Falls as Currencies Offset Latin America Car Salesby
Quarterly revenue excluding exchange-rate effects rose 1.5%
CFO says carmaker is `very satisfied' with start of 2016
PSA Group’s first-quarter revenue fell 1.4 percent as currency shifts in Latin America prevented the French carmaker from taking advantage of delivery growth in the region.
Sales amounted to 13 billion euros ($14.7 billion), the Paris-based manufacturer of Peugeot, Citroen and DS autos said in a statement on Wednesday. That compares with a restated 13.2 billion euros a year earlier, a company official said by phone. Excluding currency effects, revenue increased 1.5 percent, the carmaker said.
PSA’s deliveries in the quarter fell 1.7 percent as drops in China, India, the Pacific and the Middle East more than offset gains of 16 percent in Latin America and 5.9 percent Europe. Argentina’s peso was the world’s most volatile currency in the six months through mid-March. Exchange-rate moves primarily hurt PSA’s revenue from that country, as well as sales from Brazil, U.K. and Turkey, Chief Financial Officer Jean-Baptiste de Chatillon said Wednesday. Even so, PSA’s performance this year puts it on track to meet mid-term strategy targets outlined earlier this month, he said.
“We are very satisfied with the beginning of the year,” de Chatillon said on a conference call. “And we are hard to satisfy.”
PSA fell as much as 1.3 percent and was trading down 1 percent at 14.06 euros as of 9:23 a.m. in Paris. The stock has dropped 13 percent this year, valuing the company at 11.3 billion euros.
The “Push to Pass” strategy announced on April 5 targets a 10 percent increase in revenue by 2018 from 54.7 billion euros in 2015, and a 6 percent return on sales at its carmaking business by 2021. The company, which was bailed out two years ago by the French government and Chinese partner Dongfeng Motor Corp., plans to return to the U.S. through mobility services and to bring its traditional auto-manufacturing business to Iran, India and southeast Asia.