Fiat Chrysler

(30.05% of share capital)

 

 

The main consolidated results of the Fiat Group in 2012 are as follows:

       Year  
€ million 2012 2011 (a) Change
Net revenues 83.957 59.559 24.398
Trading profit 3.814 2.392 1.422
EBIT 3.677 3.467 210
Profit for the year 1.411 1.651 (240)
Profit attributable to owners of the parent 348 1.334 (986)
(a) Includes Chrysler from June 1, 2011.
  At
€ million 12/31/2012 12/31/2011
Total assets 82.119 80.031
Net debt (9.600) (8.898)
- of which: Net industrial debt (6.545) (5.529)
Equity attributable to owners of the parent 9.059 8.727

Net revenues

For 2012, Fiat Group revenues totaled approximately €84 billion, increasing 12% over the prior year on a pro-forma(*) basis (+8% at constant exchange rates).

  Year   Change %
€ million 2012 2011 2011       pro-forma  (a) over 2011 over 2011 pro-forma
NAFTA (mass-market brands) 43.521 19.830 33.800   n.s. 28,8
LATAM (mass-market brands) 11.062 10.562 11.068   4,7 (0,1)
APAC (mass-market brands) 3.128 1.513 2.086   n.s. 50,0
EMEA (mass-market brands) 17.800 19.591 20.078   (9,1) (11,3)
Luxury and Performance Brands (Ferrari, Maserati) 2.898 2.699 2.699   7,4 7,4
Components (Magneti Marelli, Teksid, Comau) 8.030 8.122 8.122   (1,1) (1,1)
Other
979 1.068 1.068   (8,3) (8,3)
Eliminations and adjustments (3.461) (3.826) (3.972)   (9,5) (12,9)
Net revenues 83.957 59.559 74.949   41,0 12,0
(a) Pro-forma calculated by including Chrysler results as if consolidated from January 1, 2011.

In the Mass-market brands there were strong year-over-year increases in NAFTA (+29% or 19% at constant exchange rates) and APAC (+50%). LATAM remained strong, while EMEA declined 11% on the back of a continued deterioration in European demand, particularly in Italy.

Luxury and Performance brands posted an approximate 7% increase in revenues to €2.9 billion, mainly driven by growth in North America and Asia Pacific.

For Components, revenues were substantially in line with 2011 at €8 billion.

Trading profit

Trading profit was €3,814 million, a year-over-year increase of 18% on a pro-forma basis (+11% at constant exchange rates). The NAFTA region increased €1 billion to €2,693 million, driven by strong volume growth, positive pricing and favorable currency translation. LATAM performed to expectations and posted €1,063 million of trading profit maintaining double-digit trading margin despite a 25% decrease compared with the prior year, mainly attributable to cost inflation, pricing pressure and unfavorable currency translation impacts, only partially offset by higher volumes and efficiency gains. APAC reported €260 million, nearly double the prior year. EMEA recorded a loss of €704 million, with cost containment actions only partially mitigating the impact of reduced volumes and pricing pressures. Growth for Luxury and Performance brands continued, with trading profit increasing €40 million to €392 million. Components contributed €176 million.

EBIT

EBIT was €3,677 million. Net of unusuals, there was a year-over-year increase of 17% on a pro-forma basis. For 2012, net unusuals of €244 million primarily related to the write-down of the investment in SevelNord, as well as provisions for restructuring and for disputes relating to operations terminated in prior years. For mass-market brands, EBIT by region was as follows: NAFTA €2,741 million, LATAM €1,032 million, and APAC €255 million. EMEA reported a €738 million loss (€544 million net of unusuals), compared with an €897 million loss in 2011 (€353 million net of unusuals).

  Year   Change
€ million 2012 2011   2011 pro-forma (a) over 2011 over 2011 pro-forma
NAFTA (mass-market brands) 2.741 1.087   1.770   1.654 971
LATAM (mass-market brands) 1.032 1.331   1.385   (299) (353)
APAC (mass-market brands) 255 63   119   192 136
EMEA (mass-market brands) (738) (941)   (897)   203 159
Luxury and Performance Brands (Ferrari, Maserati) 392 358   358   34 34
Components (Magneti Marelli, Teksid, Comau) 167 (110)   (110)   277 277
Other  (149) (108)   (108)   (41) (41)
Eliminations and adjustments (23) 1.787 (b) 1.788 (b) (1.810) (1.811)
EBIT 3.677 3.467   4.305   210 (628)
(a) Pro-forma calculated by including Chrysler results as if consolidated from January 1, 2011. (b) Includes €2,017 million unusual income from measurement of the stake in Chrysler upon acquisition of control, net of the related revaluation of Chrysler’s inventories of €220 million which was recognized in the income statement in June.

Profit for the year

Net financial expense for 2012 totaled €1,641 million. Excluding Chrysler, net financial expense was €825 million, compared with €796 million for 2011. Net of the impact of the mark-to-market of the Fiat stock option-related equity swaps (a €34 million gain for 2012 and €108 million loss for 2011), net financial expenses increased by €171 million, mainly reflecting higher net debt levels.

Profit before taxes was €2,036 million. Excluding Chrysler, there was a loss of €621 million, compared with a profit of €1,470 million in 2011. Net of unusuals, the loss was €360 million, compared with a profit of €381 million in 2011; the €741 million difference reflects a €692 million reduction in trading profit and €29 million increase in net financial expense.

Income taxes totaled €625 million. Excluding Chrysler, income taxes were €420 million and related primarily to the taxable income of companies operating outside Europe and employment-related taxes in Italy.

Net profit for 2012 was €1,411 million. Excluding Chrysler, there was a net loss of €1,041 million, compared with a €1,006 million profit for 2011; excluding unusual items, the loss totaled €780 million compared with a €106 million loss for 2011.

Profit attributable to owners of the parent amounted to €348 million (€1,334 million in 2011).

Equity

Equity attributable to owners of the parent at December 31, 2012 amounted to €9,059 million compared with €8,727 million at December 31, 2011.

Net debt

At December 31, 2012, consolidated net debt totaled €9,600 million, up €702 million over €8,898 million at the beginning of the year. Excluding the Chrysler Group, net debt of the Fiat Group increased €2,285 million over December 31, 2011 to €8,103 million.

Net industrial debt for the Group at December 31, 2012 was €6.5 billion, an increase of €1.0 billion for the year. For Fiat excluding Chrysler, the €2.6 billion increase in net industrial debt was driven by the net loss, negative change in working capital and capital expenditure on new products: as a result, net industrial debt increased to €5.0 billion. Chrysler reported positive cash flow of €1.6 billion, thus reducing its net industrial debt to €1.5 billion, despite increased capital expenditure of €4.3 billion.

  At  
€ million 12/31/2012 12/31/2011 Change
Debt (27.889) (26.772) (1.117)
- Asset-backed financing (449) (710) 261
- Other debt (27.440) (26.062) (1.378)
Current financial receivables from jointly-controlled (a) 58 21 37
Gross debt (27.831) (26.751) (1.080)
Other financial assets (liabilities)(b) 318 128 190
Cash and cash equivalents and current securities 17.913 17.725 188
Net debt (9.600) (8.898) (702)
Industrial Activities (6.545) (5.529) (1.016)
Financial Services (3.055) (3.369) 314
(a) Includes current financial receivables from the FGA Capital Group. (b) Includes fair value of derivative financial instruments.

Significant events

On January 5, 2012, Fiat announced achievement of the “Ecological Event” (3rd Performance Event established in Chrysler Group’s Amended and Restated LLC Operating Agreement), leading to a further 5% increase of its interest in Chrysler. Fiat currently has a 58.5% ownership interest in Chrysler and the UAW Retiree Medical Benefits Trust (VEBA Trust or VEBA) owns the remaining 41.5%.

On April 27, 2012, Standard & Poor’s lowered its rating on Fiat S.p.A.’s long-term debt from “BB” to “BB-“ with a stable outlook. The short-term rating was confirmed at “B”.

On May 2 2012, Fiat and Tata agreed that management control of Fiat’s commercial and distribution activities in India would be handed over to a separate Fiat Group company to enable greater focus on development of the Fiat brand. A new network is being developed progressively and the existing Fiat-franchised Tata dealers will be encouraged to form the basis of that network.

On May 21, 2012, the Company completed the mandatory conversion of all preference and savings shares into Fiat ordinary shares pursuant to the shareholder resolution of April 4, 2012. As a result of the conversion, Company share capital increased to €4,476,441,927.34, consisting of 1,250,402,773 shares with a par value of €3.58 each.

On June 28, 2012, a ceremony was held at the Fiat-GAC plant in Changsha, China, to celebrate completion of the new factory and rollout of the Fiat Viaggio, the first Fiat model produced in China by the joint venture.

On July 3, 2012, Fiat notified VEBA of Fiat’s intention to exercise its option to purchase a portion of VEBA’s ownership interest in Chrysler (equivalent to 3.3% of Chrysler’s equity). On September 26, 2012, Fiat announced that Fiat North America (a wholly-owned subsidiary) was seeking judgment from the Delaware Court of Chancery confirming the purchase price to be paid for the stake, as the parties had not reached an agreement on the purchase price.

On January 3, 2013, Fiat notified VEBA of Fiat’s exercise of its option to purchase a second tranche of the interest held in Chrysler Group LLC by VEBA (representing a further 3.3% of Chrysler’s equity). In the event these pending transactions are completed as contemplated, Fiat will hold 65.17% of the outstanding equity in Chrysler.

On July 26, 2012, Fiat Group Automobiles S.p.A. (FGA) and PSA Peugeot Citroën signed an agreement for the transfer of FGA’s shareholding in the SevelNord joint venture to PSA Peugeot Citroën on or before December 31, 2012. SevelNord will continue to produce LCVs for the two groups until the end of 2016. The agreement does not impact on other co-operation agreements between FGA and PSA Peugeot Citroën, including the Sevel joint venture located in Val di Sangro (Italy), which will continue as per current contracts.

On September 13, 2012, for the fourth consecutive year, Fiat S.p.A. was included in the Dow Jones Sustainability Indexes (DJSI) World and Europe, receiving a score of 91/100 compared with an overall average of 74/100 for companies in the Automobiles sector evaluated by SAM, the specialists in sustainability investing. Membership in the prestigious DJSI World and DJSI Europe equity indexes is limited to companies judged best-in-class in terms of their economic, as well as environmental and social performance.

On October 10, 2012, Moody’s lowered Fiat S.p.A.’s Corporate Family Rating from “Ba2” to “Ba3” and, in accordance with their methodology, the ratings on notes issued by Fiat Finance & Trade Ltd. S.A. and Fiat Finance North America, Inc. were also lowered from “Ba3” to “B1”. The outlook of both ratings agencies is negative.

On November 7, 2012, Fiat’s Pomigliano D’Arco plant was awarded the prestigious “Automotive Lean Production 2012” award in the OEM category, based on the evaluation of a committee of experts selected by the German magazine Automobil Produktion and a leading consultancy firm.

On December 20, 2012, at the Fiat plant in Melfi, Chairman John Elkann and CEO Sergio Marchionne – with Prime Minister Monti in attendance – presented plans for the production of a new Jeep brand vehicle and a new Fiat brand vehicle beginning in 2014. Following an investment program of more than €1 billion, Melfi will be one of the most advanced car assembly plants in the world equipped with the very latest technologies and managed according to World Class Manufacturing standards.

On January 9, 2013, Chrysler Group announced that it had received a demand from the VEBA pursuant to the Shareholder Agreement, seeking registration of approximately 16.6% of Chrysler Group’s outstanding equity interests currently owned by VEBA.

On January 18, 2013, Fiat Group Automobiles S.p.A. (FGA) and Mazda Motor Corporation (Mazda) signed a final agreement for the development and manufacture of a new roadster for the Mazda and Alfa Romeo brands based on Mazda’s next-generation MX-5 rear-wheel-drive architecture. Each model will be powered by proprietary engines unique to the respective brands. Both vehicles will be manufactured at the Mazda plant in Hiroshima, Japan. Production of the Alfa Romeo model is scheduled to begin in 2015.

On February 25, 2013, Fitch Ratings downgraded Fiat S.p.A.’s long-term debt rating from “BB” to “BB-”, with a negative outlook.

Commercial Register No.64236277 Legal notes | Credits