FCA(29,15% stake, 44.26% of voting rights on issued capital)




Key consolidated figures of FCA reported in the first half of 2016 and in the second quarter of 2016 are as presented below. Unless otherwise indicated, the data of the first half of 2015 and the second quarter of 2015 have been re-presented to exclude Ferrari, consistent with Ferrari’s classification as a discontinued operation for the year ended December 31, 2015.

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(1) Adjusted EBIT is a non-GAAP financial measure used to measure performance. It is calculated as EBIT excluding gains/(losses) on the disposal of investments, restructuring, impairments, asset write-offs and other unusual income/(expenses) that are considered rare or discrete events that are infrequent in nature.

Net revenues

Net revenues in the second quarter of 2016 were €27.9 billion, a decrease of €0.7 billion (-2%; +1% at constant exchange rates) compared to the second quarter of 2015. As for the segments, increases were recorded of €0.3 billion both in NAFTA (+2%; +4% at constant exchange rates) due to improved model mix and positive net pricing actions, which were partially offset by negative foreign currency effects, and in EMEA (+5%; +7% at constant exchange rates), driven by the increase of volumes of light commercial vehicles and the new Tipo family.

The decrease in LATAM revenues of €0.4 billion (-21%; -9% at constant exchange rates) is attributable to lower volumes and unfavorable foreign exchange effect, whereas the reduction in APAC of €0.6 billion (-37%; -34% at constant exchange rates) was due to lower shipments, which was partially offset by favorable vehicle mix.

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Adjusted EBIT

Adjusted EBITin the second quarter of 2016 was €1,628 million, an increase of €227 million (+16%) compared to €1,401 million in the second quarter of 2015, thanks to improvements recorded by NAFTA, driven by favorable model mix and purchasing efficiencies, partially offset by an increase in product costs for vehicle content enhancements; and by EMEA, attributable to higher volumes and favorable vehicle mix and manufacturing and purchasing efficiencies, which were partially offset by an increase in research and development costs and also advertising costs to support new product launches.

Adjusted EBIT in LATAM also improved (+€79 million) primarily on account of a positive vehicle mix effect, a decrease in industrial costs and selling, general and administrative costs as a result of continued cost reduction initiatives to rightsize to market volume, partially offset by the decrease in volumes and input cost inflation.

In APAC Adjusted EBIT decreased by 11% (-5% at constant exchange rates) attributable to lower shipments, net of favorable vehicle mix, which was partially offset by a decrease in industrial costs due to the localization of Jeep production, a decrease in direct marketing costs which are now incurred by the joint venture in China and improved results from that joint venture.

The decrease in Maserati Adjusted EBIT was due to lower volumes, an increase in industrial and selling, general and administrative costs for the all-new Levante and restyled Quattroporte launch activities, which were partially offset by favorable mix and positive foreign exchange impacts, whereas the increase in Components Adjusted EBIT is due to favorable mix, which were partially offset by higher industrial costs.

The analysis of Adjusted EBIT by segment is as follows:

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EBIT

In the second quarter of 2016 net unusual expenses were recorded for €568 million, of which €414 million refers to the estimated costs of the recall campaign for airbag inflators and €105 million (€51 million in the first quarter 2016) for incremental costs to realign NAFTA’s existing productive capacity.

In the second quarter of 2015 unusual expenses totaled €175 million, mainly in respect of the devaluation of the Venezuelan bolivar resulting from the adoption of the SIMADI exchange rate (€80 million) and the consent order agreed with the National Highway Traffic Safety Administration in the United States for €81 million.

Net profit for the period

Net financial expensesin the second quarter of 2016 totaled €491 million, a decrease of €128 million compared to the second quarter of 2015 primarily due to the reduction in gross debt and refinancing at lower rates.

Net debt

Net industrial debt at June 30, 2016 was €5.5 billion. The decrease of €1.1 billion compared to March 31, 2016, principally reflects cash flows from operating activities (€1.8 billion), net of capital expenditures during the quarter of €2.1 billion.

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Significant events in the second quarter of 2016 and subsequent events

On April 15, 2016 the general meeting of the shareholders approved a demerger that is the initial step in the previously announced plans to distribute the ordinary shares of RCS MediaGroup S.p.A. held by FCA to the holders of its common shares. The distribution was effected through several transactions that became effective in May.

On May 3, 2016 Google Self-Driving Car Project and FCA executed a first-of-its-kind collaboration to integrate Google’s self-driving technology into the Chrysler Pacifica hybrid minivans.

On May 10, 2016 Moody’s raised the Corporate Family Rating of FCA N.V. to “Ba3” from “B1” and the rating on the bonds issued or guaranteed by FCA N.V. to “B1” from “B2”, with a stable outlook.

On July 18, 2016 FCA confirmed that it was cooperating with a Securities Exchange Commission investigation into the reporting of vehicle unit sales to end customers in the United States.  In its annual and quarterly financial statements, FCA records revenues based on shipments to dealers and customers and not on reported vehicle unit sales to end customers. FCA will cooperate fully with these investigations.

As announced in its July 26, 2016 press release FCA US has modified its methodology for monthly  sales reporting. FCA US’s reported vehicle sales represent unit sales of vehicles to retail customers, deliveries of vehicles to fleet customers and to others such as FCA US’s employees and retirees as well as vehicles used for marketing. Most of these reported sales reflect retail sales made by dealers out of their own inventory of vehicles previously purchased by them from FCA US. Reported vehicle units sales do not correspond to FCA US’s reported revenues, which are based on FCA US’s sale and delivery of vehicles, and typically recognized upon shipment to the dealer or end customer.

On August 1, 2016 Gruppo Editoriale l’Espresso S.p.A. (GELE) and Italiana Editrice S.p.A. (ITEDI) announced the signing of a framework agreement, which sets out the terms of the proposed integration between the two companies. The agreement was also signed by CIR S.p.A. (CIR), controlling shareholder of GELE, as well as FCA and Ital Press Holding S.p.A., controlled by the Perrone family, the shareholders of ITEDI. The combination will result in creation of the leading player in the Italian media and newspaper publishing sector and one of the leaders in Europe.

Under the agreement, FCA and Ital Press will transfer 100% of their ITEDI shares to GELE in exchange for newly-issued reserved shares. Upon completion of the transaction, CIR will hold a 43.4% ownership interest in GELE, with FCA holding 14.63% and Ital Press 4.37%. As soon as practicable following completion, FCA will distribute its entire interest in GELE to holders of FCA common stock. That distribution will result in EXOR acquiring a 4.26% interest in GELE. In conjunction with the merger agreement, CIR also entered into two shareholder agreements with deferred effect with FCA and Ital Press relative to their respective future shareholdings in GELE. In addition to CIR’s undertaking to vote for the proposed transaction at the GELE shareholder meeting, to be convened at the proper time, the parties also undertake, with effect from the completion date of the merger, to appoint John Elkann and Carlo Perrone to the GELE Board of Directors and grant CIR the right to appoint the Chairman and Chief Executive Officer.

FCA also undertakes, for the duration of the shareholder agreement, not to transfer its shares in GELE that are subject to the terms of the agreement.

The agreement between CIR and FCA will expire upon distribution by FCA of its shares in GELE to holders of FCA common stock. Concurrent with the expiry of the CIR-FCA shareholder agreement, a new shareholder agreement will take effect between CIR and EXOR. The terms of that agreement include: obligations of mutual consultation in advance of any GELE shareholder meeting; undertakings from CIR relating to the appointment and permanence to GELE’s board of directors of a representative designated by EXOR; undertakings from EXOR to present and vote for a single voting list jointly with CIR for elections to GELE’s board of directors; and an undertaking from EXOR, for the duration of the agreement, not to transfer the shares subject to the terms of the agreement (with the exception of transfers to other members of the EXOR group).

Both the CIR-EXOR and CIR-Ital Press shareholder agreements will remain in force for a period of three years.

Completion of the transaction is expected during the first quarter of 2017.

Commercial Register No.64236277 Legal notes | Credits