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October 28, 2004

ITALY: Fiat Auto Q3 results worse than analysts expected

Profitability at Fiat SpA improved in the third quarter, but the company's core Fiat Auto unit performed slightly worse than expected, Dow Jones Newswires reported.

By bcusack

Profitability at Fiat SpA improved in the third quarter, but the company’s core Fiat Auto unit performed slightly worse than expected, Dow Jones Newswires reported.

Fiat posted a group net loss of €554 million for the quarter, compared to a €84 million loss in the same period last year but the company noted that its consolidated net loss in fact narrowed by €378 million if capital gains on the sale last autumn of its avionics unit is factored out.

The report said strong profitability at trucks unit Iveco and tractor-and-bulldozer unit CNH Global NV pushed the company to reiterate its full-year goal of operating break-even in 2004.

Fiat’s third-quarter operating loss narrowed to €997 million from €285 million in the same period last year.

Dow Jones Newswires said that Fiat Auto boosted revenue by 11% to €4.49 billion from €4.16 billion. But the car-making division cut its operating losses only slightly, to €270 million from €314 million in the third quarter of 2003. The improvement was greater on a pro forma basis as Fiat owned all of its profitable consumer finance division during part last year’s third quarter.

Analysts polled by Dow Jones Newswires before Fiat released its results expected a group net loss of €364 million, an operating loss of €101 million and revenue of €10.19 billion. They expected a €240 million operating loss at Fiat Auto with revenue at €4.35 billion.

Truckmaker Iveco posted €76 million in operating profit in the third quarter, up from a €2 million operating loss in the same period last year, the report added.

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