US: Chrysler boosts Q2 net income 16%
- Chrysler Group net income for the second quarter of 2013 up 16% to $507m
- Revenue up 7% to $18bn
- Operating profit up 7% to $808m
- Worldwide vehicle shipments up 5% to 660,000, sales up 10% to 643,000
- Full-year operating profit and net income guidance revised
Chrysler Group second quarter 2013 net income rose 16% to $507m on sales up 7% to $18bn.
Operating Profit was up 7% to $808m despite a $151m charge related to various recalls. Operating Profit was $1.2bn for the first half of the year.
Net income was $530m.
Worldwide vehicle shipments rose 5% to 660,000, including 18,000 contract manufactured vehicles. Shipments in the first half of 2013 totaled 1,234,000 vehicles.
Worldwide vehicle sales were up 10% to 643,000 for the second quarter driven largely by a 17% increase in the company's US retail sales.
International vehicle sales (outside North America) rose 7% to 75,000, including 15,000 vehicles manufactured by Chrysler and sold by Fiat.
Full-year 2013 guidance has been revised:
- Worldwide vehicle shipments of ~2.6m (from 2.6-2.7m)
- Net revenue of $72-$75bn (no change)
- Operating profit of $3.3-$3.8bn (from ~$3.8bn)
- Net income of $1.7-$2.2bn (from ~$2.2bn)
Chrysler Group Reports Second-Quarter Net Income of $507 Million
MODIFIED OPERATING PROFIT FOR THE QUARTER WAS $808 MILLION, FROM $755 MILLION A YEAR AGO
AUBURN HILLS, Mich., July 30, 2013 /PRNewswire/ --
-- Chrysler Group LLC net income for the second quarter of 2013 was $507
million, an increase of 16 percent from $436 million a year ago
-- Net revenue for the quarter was $18.0 billion, up 7 percent from a year
-- Modified Operating Profit((b)) increased 7 percent to $808 million in
the second quarter, from $755 million a year earlier
-- Free Cash Flow((e)) for the second quarter totaled $91 million;
Cash((d)) as of June 30, 2013, was $11.9 billion, comparable with March
31, 2013, and slightly lower than $12.1 billion a year ago
-- Net Industrial Debt((f)) was $656 million at June 30, 2013, up slightly
from $619 million at March 31, 2013, and $432 million a year ago
-- Worldwide vehicle shipments were 660,000 for the quarter, up 5 percent
from 630,000 a year ago
-- Strong worldwide vehicle sales for the second quarter of 643,000, up 10
percent from a year ago, were driven primarily by a 17 percent increase
in U.S. retail sales
-- U.S. market share was 11.4 percent for the second quarter, compared with
11.2 percent a year ago; Chrysler Group market share was 15.1 percent in
Canada, up from 14.5 percent a year ago
-- Full-year 2013 Modified Operating Profit and net income guidance revised
Chrysler Group LLC today reported its preliminary second-quarter 2013 results, including net income of $507 million, an increase of 16 percent from $436 million in the same quarter a year earlier. The second quarter marks the Company's eighth consecutive quarter of positive net income.
Net revenue was $18.0 billion for the second quarter of 2013, an increase of 7 percent from $16.8 billion for the same period last year, primarily driven by an increase in vehicle shipments, including the new Jeep Grand Cherokee and Ram pickup trucks. Net revenue totaled $33.4 billion for the first half of 2013.
"Chrysler Group is poised for a very strong performance in the second half of the year, with the new Jeep Grand Cherokee and Ram 1500 pickup earning best-in-class recognition, and the all-new Jeep Cherokee now rolling off the line," Chrysler Group LLC Chairman and CEO Sergio Marchionne said. "As we have highlighted previously, the timing of product launches and capacity increases causes this year's performance to be biased to the second half, and a continued aggressive drive for excellence and flawless execution will be essential to attain the targets we've set for ourselves."
CHRYSLER GROUP LLC
Q2 Q2 Q2 2013 H1 H1 H1 2013
2013 2012 B/(W) 2013 2012 B/(W)
Q2 2012 H1 2012
--- ------- ------- -------
Net Revenue 17,994 16,795 1,199 33,379 33,154 225
----------- ------ ------ ----- ------ ------ ---
Modified Operating Profit 808 755 53 1,243 1,495 (252)
------------------------- --- --- --- ----- ----- ----
Modified EBITDA 1,484 1,424 60 2,533 2,808 (275)
Net Income 507 436 71 673 909 (236)
Add: Loss on Extinguishment of Debt 23 - - 23 23 - - 23
--- --- --- --- --- ---
Adjusted Net Income 530 436 94 696 909 (213)
------------------- --- --- --- --- --- ----
Cash 11,881 12,075 (194)
---- ------ ------ ----
Note - Refer to the Non-
U.S. GAAP Financial
Information and Other Items
section of this release for
information regarding non-
GAAP financial measures
Modified Operating Profit was $808 million, or 4.5 percent of revenue, in the second quarter, versus $755 million reported in the prior year. The 7 percent increase was primarily due to higher shipment volumes and positive pricing, partially offset by higher industrial and launch-related costs, as well as a $151 million charge related to the voluntary safety recall for the 1993-1998 Jeep Grand Cherokee and the 2002-2007 Jeep Liberty, and the customer satisfaction action for the 1999-2004 Jeep Grand Cherokee. Modified Operating Profit was $1.2 billion for the first half of the year.
Modified EBITDA((c)) was $1.5 billion in the second quarter, or 8.2 percent of revenue, compared with $1.4 billion in the prior year, or 8.5 percent of revenue. Modified EBITDA was $2.5 billion in the first half of 2013.
Adjusted Net Income((a)) was $530 million for the second quarter, after adjusting for a $23 million charge recognized in connection with the June 2013 re-pricing and amendment of the Company's Tranche B Term Loan and undrawn revolving credit facility.
Cash( )as of June 30, 2013, was $11.9 billion, consistent with March 31, 2013, and slightly lower than the $12.1 billion as of June 30, 2012. Total available liquidity as of June 30, 2013, was $13.2 billion, including $1.3 billion available under a revolving credit facility. Free Cash Flow was $91 million for the second quarter of 2013, and $540 million for the first half of the year.
Financial liabilities( )at June 30, 2013, totaled $12.5 billion, consistent with March 31, 2013, and June 30, 2012. Net Industrial Debt((f)) was $656 million at the end of the quarter, versus $619 million at March 31, 2013, and $432 million at June 30, 2012. Interest expense for the second quarter of 2013 was $265 million, compared with $278 million a year ago. Interest expense for the first half of 2013 was $528 million.
During the second quarter of 2013, Chrysler Group amended its U.S. and Canadian salaried defined benefit pension plans. The U.S. plans were amended in order to comply with IRS regulations; consequently the accrual of future benefits will cease effective December 31, 2013, and the Company decided to enhance the retirement factors. The Canada amendment also ceases the accrual of future benefits effective December 31, 2014, and enhances the retirement factors. The changes to the plans resulted in a curtailment gain and plan amendments for which the Company recognized a $218 million net reduction to the pension obligation with a corresponding increase in accumulated other comprehensive income during the second quarter of 2013.
Worldwide vehicle shipments for the quarter were 660,000, including 18,000 contract manufactured vehicles, an increase of 5 percent from the second quarter of 2012 when the Company shipped 630,000 vehicles, including 25,000 contract manufactured vehicles. Shipments in the first half of 2013 totaled 1,234,000 vehicles.
Worldwide vehicle sales were 643,000 for the second quarter, up 10 percent from 582,000 vehicles sold in the second quarter of 2012, driven largely by a 17 percent increase in the Company's U.S. retail sales. Chrysler Group's June 2013 U.S. sales reflected the Company's 39(th) consecutive month of sales gains. The result continues to demonstrate the positive commercial momentum of Chrysler Group's product portfolio, including the Dodge Dart, named Strategic Vision's Best for Total Quality in the small car segment; the Ram Heavy Duty; and the Jeep Grand Cherokee and Jeep Wrangler. Worldwide sales in the first half of 2013 totaled 1,206,000 vehicles.
Chrysler Group's U.S. market share increased to 11.4 percent for the quarter from 11.2 percent a year ago, and market share in Canada increased to 15.1 percent compared with 14.5 percent a year ago.
U.S. dealers' days' supply of inventory at the end of June 2013 was 68, consistent with 66 days at the end of March 2013, and 67 days at the end of June 2012.
International vehicle sales (outside North America) for the quarter increased 7 percent from the second quarter of 2012, to 75,000, including 15,000 vehicles manufactured by Chrysler Group and sold by Fiat S.p.A.
Full-Year 2013 Guidance Revised
The targets for full-year 2013 are revised as follows:
-- Worldwide vehicle shipments of ~2.6 million (from 2.6-2.7 million)
-- Net revenue of $72-$75 billion (no change)
-- Modified Operating Profit of $3.3-$3.8 billion (from ~$3.8 billion)
-- Net income of $1.7-$2.2 billion (from ~$2.2 billion)
-- Free Cash Flow( )of >$1 billion (no change)
Original source: Chrysler
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