PSA Group, the French carmaker in talks to buy Opel and Vauxhall from General Motors, announced its first dividend in six years and raised its medium-term profitability goal on Thursday after full-year profit almost doubled.
The Paris-based maker of Peugeot and Citroen cars said stronger pricing, sales of higher-specification models and cost cuts lifted the automotive operating margin to a record 6 per cent last year from 5 per cent in 2015.
The group raised its automotive margin goal to an average 4.5 per cent for the 2016-18 period while declining to comment in detail on its continuing Opel and Vauxhall takeover talks with GM.
PSA's €6.8bn in net cash equips the company to make "profitable investments in the interest of our shareholders", Chief Financial Officer Jean-Baptiste de Chatillon told reporters on a call.
But he added: "At this stage there can be no certainty as to the outcome of these talks."
The French group and Detroit-based GM confirmed on 14 February they were in talks over a PSA-Opel tie-up to create Europe's second-largest carmaker by sales after Volkswagen.
PSA expects the deal to lead to combined sales of 5 million vehicles in 2020-22 and savings between €1.5bn and €2bn, sources told Reuters on Wednesday.
Net income rose 92 per cent to €1.73bn last year, PSA said. Recurring operating income rose 18 per cent to €3.235bn on €54bn in revenue, down 1.1 per cent.
That beat expectations of €3.14bn in recurring operating income and €53.7bn in revenue, based on the median estimates in an Inquiry Financial poll of 13 analysts.
Reuters
