PSA Groupe has delivered significantly improved operating income up 18% to EUR3.24bn (US$3.4bn) handing the manufacturer a healthy warchest ahead of its proposed purchase of Opel from General Motors.
For the third year in a row, the Group achieved growth on three fronts:
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. Growth of the Automotive division operating margin to 6% versus 5% in 2015.
. Growth of sales : 3.15m vehicles sold, up 5.8%.
. Growth of the net financial position thanks to a positive EUR2.7bn free cash flow in 2016.
For the first time since 2011, a dividend of EUR0.48 per share will be submitted for approval at the next Shareholders' Meeting.
"These results demonstrate our ability to consistently deliver an excellent performance in an adverse environment.," said PSA Groupe chairman, Carlos Tavares.
"They are the outcome of the Group's operating efficiency improvement and our competitive teams' focus on the execution of the Push to Pass plan.
"Day after day, the Group is building the conditions for profitable and sustainable growth, reinforced by the success of the first launches in its product offensive."
In 2016, Group revenues were EUR54.030bn compared to EUR54.68m in 2015 and Automotive revenues were EUR37.066bn, compared to EUR37.514bn in 2015 which represent respectively a growth of 2.1% and 2.7%, at constant exchange rates, driven notably by recently launched models and the Group's pricing power strategy.
Net of adverse change in exchange rates, both Group and Automotive revenues were down 1.2%.
The Group recurring operating income was EUR3.235bn, up 18% compared to 2015. The Automotive recurring operating income was EUR2.225bn, up 19% compared to 2015.
In an environment characterised by adverse exchange rates, the growth was driven by higher volumes, positive price and mix effects, and lower fixed and production costs.
Net income reached EUR2.149bn, an increase of EUR947m compared to 2015. Net income, Group share, reached EUR1.73bn compared to EUR899m in 2015.
Banque PSA Finance reported recurring operating income of EUR571m, up 11% versus 2015.
Faurecia recurring operating income was EUR970m, up 17%.
Total inventory, including independent dealers, stood at 406,000 vehicles at 31 December 2016, an increase of 56,000 units year on year.
Market outlook:
In 2017, the Group anticipates a stable automotive market in Europe, Latin America and Russia, and growth of 5% in China.
Operational outlook improved:
The new objectives of the Push to Pass plan are to:
. Deliver more than 4.5% Automotive recurring operating margin on average in 2016-2018, and target 6% by 2021;
. Deliver 10% Group revenue growth by 2018 vs 2015 and target additional 15% by 2021.
