Fiat Chrysler earns $718M in 2014
Fiat Chrysler Automobiles NV looks to accelerate all aspects of its global operations in 2015, according to CEO Sergio Marchionne.
"The machine will continue to make progress and we should see black numbers across all regions," he said during a call with investors and news media Wednesday morning. "We've laid a foundation for a set of objectives in 2015, a very clear milestone toward our 2016 and 2018 objectives."
For 2015, the company expects shipments of 4.8 million-5 million cars and trucks, up from 4.6 million in 2014; net income of 1 billion-1.2 billion euro ($1.14 billion-$1.36 billion); earnings before interest payments and income taxes (EBIT) in the range of 4.1 billion-4.5 billion euros ($4.6 billion-$5.1 billion); and net revenue of 108 billion euros ($122.7 billion).
The financial goals are in addition to introducing a number of new vehicles globally, opening production facilities in Brazil and China, and spinning off high-performance luxury brand Ferrari into its own publicly traded company.
The 2015 guidance was announced Wednesday in connection with the automaker reporting a profit of 632 million euros (about $718 million) in 2014, significantly down from 1.9 billion euros ($2.2 billion) in 2013 — but in line with its full-year guidance.
The decrease in profit was primarily due to aggressive investments as part of a previously announced five-year plan; 650 million euros ($738.6 million) in recall costs for North America; and a 495 million euro payment that was part of fully acquiring Chrysler Group LLC, now FCA US LLC.
Regarding recall costs in 2015, Fiat Chrysler Chief Financial Officer Richard Palmer would not give guidance on the company's expectations, but said the company is "watching this very closely."
The company's earnings before interest and taxes last year increased 7 percent compared to the previous year to 3.2 billion euros ($3.7 billion).
Revenue also increased 11 percent to 96.1 billion euros ($109 billion), beating its projected 93 billion euro ($106 billion) outlook.
"We managed to get a number of things done in 2014," Marchionne said. "2014 was a momentous year for us."
In 2014, the company fully acquired Chrysler Group in January; announced an ambitious five-year growth plan in May; merged former Chrysler parent company Fiat SpA into Fiat Chrysler and listed the new company on the New York Stock Exchange in October; re-launched Alfa Romeo in the U.S. after a 20-year hiatus.
Fiat Chrysler shipped 4.6 million cars and trucks in 2014, including a record of more than 1 million Jeeps. The shipments were up 6 percent compared to 2013 but just missed the company's 4.7 million sales forecast for 2014.
The automaker, as outlined in a five-year plan in May, expects to sell 7 million vehicles globally by 2018.
In an encouraging letter to employees obtained by The Detroit News, Marchionne outlined the company's success in 2014 and encouraged employees to continue the momentum in 2015.
"This is just the beginning of a new year filled with opportunities for continued growth together with the challenges of an incredibly competitive landscape," reads the letter.
"Let's continue to dream big and take accountability for achieving our targets so that this time next year we, as a team, can look back with pride at the progress we have made as we continue this remarkable journey."
Fiat Chrysler shares, traded under FCAU, closed Wednesday down 2.2 percent to $12.91 per share.
FCA US, formerly Chrysler Group, will release its fourth-quarter and full-year earnings on Tuesday.
Ford earnings next
Ford Motor Co. will release fourth-quarter and full-year earnings Thursday.
The Dearborn automaker is the first of the Detroit automakers to report earnings, which will let UAW workers know how much their 2014 profit-sharing payments will be, based on North American pre-tax profits.
FCA US, formerly Chrysler Group, will release its earnings Tuesday, followed by General Motors Co. on Feb. 4.