Thursday, July 18, 2024

Renault cuts dividend, slices revenue aim for 2020

Renault cuts dividend, slices revenue aim for 2020

Renault acting CEO: 2019 has been a difficult year for many reasons

Renault reported its first loss in a decade and minimize its 2020 margin goal on Friday, because it makes an attempt to attract a line beneath the Carlos Ghosn affair and reboot its Nissan alliance.

The French carmaker is attempting to maneuver on from the inner turmoil sparked by the scandal involving its former boss Ghosn with a administration shake-up.

In the meantime, additionally it is grappling like different automakers, together with Japan’s Nissan, with tumbling auto demand in some key markets like China.

“It has been a tricky 12 months for Groupe Renault and the alliance,” appearing Chief Government Clotilde Delbos advised a convention name, including that the broader autos downturn had hit the corporate “proper after we had been going through inside difficulties.”

Chatting with CNBC’s Charlotte Reed Friday, she stated 2019 had been a troublesome 12 months for a lot of causes.

“One of many causes is the market itself, the market has been troublesome. A variety of volatility particularly within the nations the place we’re robust … We additionally had inside difficulties just like the governance problem that we went by over the 12 months but in addition our price construction. We spent an excessive amount of on R&D (analysis and growth) and capex (capital expenditure) and now we have an excessive amount of price,” she stated.

Renault posted a lack of 141 million euros ($153 million) for the group share of internet revenue, partially on account of fees linked to a few of its Chinese language joint ventures.

The contribution from Nissan, during which Renault has a 43% stake, additionally fell and it was hit by a French deferred tax cost.

A view of the show of Renault on the Car Commerce Honest 2019 in Barcelona, Could 11, 2019.

Ramon Costa | SOPA Photos | LightRocket | Getty Photos

Nissan this week had its first quarterly loss in almost ten years and minimize its working revenue forecast.

Renault set a 2020 working margin goal of between 3% and 4%, down from 4.8% in 2019, and sliced its proposed dividend in opposition to 2019 by nearly 70% from a 12 months earlier.

Renault shares had been down 4.3% at 0831 GMT.

Luca de Meo, who used to run Volkswagen’s Seat model, is about to hitch as CEO in July, taking on from Delbos, who can also be Renault’s monetary chief.

She stepped into the CEO position on an interim foundation after Thierry Bollore, a long-standing Ghosn ally, was ousted in October.

Ghosn, who ran Renault and oversaw its alliance with Nissan, was arrested in Japan in late 2018 on monetary misconduct fees, however fled to Lebanon in December.

He has denied wrongdoing and hit out at his previous employers, saying the Renault-Nissan alliance was all however lifeless with out him.

Renault has a governance issue that hasn't been addressed, analyst says

Alliance skeptics

Renault executives repeated assurances that the Nissan alliance was on monitor. Delbos acknowledged that traders had been nonetheless skeptical, however stated that the corporations would offer meatier joint objectives by Could.

Carmakers have posted contrasting performances in an trade hobbled by falling international demand, squeezed by excessive funding prices for cleaner fashions, and now going through provide chain issues resulting from China’s coronavirus outbreak.

Nonetheless, Italy’s Fiat Chrysler posted larger fourth-quarter revenue resulting from a powerful North American enterprise.

Renault forecast that the worldwide auto market would fall in 2020, with gross sales in Europe and Russia down round 3%.

It stumbled in a number of nations, together with Argentina, and stated it wanted to repair its operations in China, the place it has a partnership with Dongfeng on electrical automobiles and with Brilliance China Automotive Holdings on business automobiles.

Renault stated its objectives didn’t take note of potential impacts from the coronavirus disaster in China, the place it has a manufacturing facility in Wuhan, the epicenter of the epidemic, which has been in lockdown to comprise the unfold of the virus.

It has additionally suspended operations for at the least 4 days at its South Korean subsidiary resulting from provide chain hiccups.

Renault’s group gross sales fell 3.3% to 55.53 billion euros in 2019, beating a median 55.24 billion-euro forecast anticipated by 20 analysts polled by Refinitiv.

Gross sales had been down 2.7% at fixed change charges.

Renault acting CEO: 'Very optimistic' on auto alliance

—CNBC’s Matt Clinch contributed to this text.

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