FRANCE: PSA expects EUR405m+ auto H2 loss

By Graeme Roberts | 14 December 2011

PSA Peugeot Citroen expects an auto division second-half operating loss of over EUR405m (US$530m) as Europe's economic woes hit demand.

CEO Philippe Varin told France's National Assembly on Wednesday that the company would also see negative free cash flow in the second half, Reuters reported.

"We expect to lose what we made in the first half and more," Varin said, referring to the auto division.

"This does not come as a surprise," one Paris-based share trader told the news agency. "Some of the comments look quite negative, but a lot of this is already baked in the cake at current levels and Peugeot is clearly already a consensus short."

The automaker had already warned twice this year about its auto unit's results. At the end of July it cited the Japanese earthquake and higher raw material prices when lowering its second-half forecast.