ANALYSIS: PSA loss "not as catastrophic" as feared: Metzler Bank analyst
Write-downs and a collapse to sales in Europe have left PSA with a record net loss for 2012
The bad figures reflect the ongoing struggles in Europe, but Metzler Bank, Germany's oldest private bank still owned by the founding family, believes the worst may soon be over.
"Not as bad [figures] or as catastrophic as I thought," Metzler Bank automotive analyst, Juergen Pieper, told just-auto from Germany. "It is a little bit better than expected on the liquidity side, on the cash flow side.
"We always heard from PSA outflow is EUR200m [burn], so now it is hardly more than EUR100m per month. The Group operating loss of EUR580m or so is slightly better than expected. Two of the key results are not as bad as expected."
PSA also chose to include a write down of EUR4.7bn in asset valuations, with the combined headline figure comparing to a net profit in 2011 of EUR588m.
The automaker also points out it implemented cost savings of EUR1.2bn last year - ahead of target - and that premium vehicle sales had doubled their market share.
"They said cash out improves to half the rate of last year - OK this is likely a lot depends on the European markets and there is no positive sign yet," said Pieper.
"There is maybe very cautious optimism. At the moment we are perhaps in the worst situation [but] we have seen slow improvement over the course of year with the chance the fourth quarter may find its bottom."
PSA recently held the last of a series of ten meetings with its major unions to thrash out the terms of a restructuring plan that will see it axe up to 8,000 staff and close its Aulnay plant near Paris.
The automaker's banking division also recently received a temporary green light from the European Commission for France to guarantee EUR1.2bn to avoid any "contagion" to the country's banking system.
Approval of the short-term measure is subject however, to PSA presenting a restructuring plan to the Commission, which includes the viability of Banque PSA Finance.
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