Chrysler 3Q net profit up 80% to $381M
By Bryce G. Hoffman The Detroit News
Chrysler Group LLC reported a net profit of $381 million for the third quarter of 2012 on Monday, up 80 percent from the $212 million profit the company reported for the same period a year ago.
It was further proof that the Auburn Hills automaker's recovery is continuing, and should help offset the losses that its Italian parent company, Fiat SpA, is expected to announce on Tuesday.
"The third-quarter financial results that we released today represent another pillar in the platform of accountability that we are building," Fiat-Chrysler CEO Sergio Marchionne said in an email to employees Monday, a copy of which was obtained by The Detroit News.
"Our competitors are not showing signs of vulnerability, and we will have to continue fighting for our share. But we are going in the right direction, and I simply ask you to keep faith in Chrysler and in each other and keep working to shape this company and our collective future exactly as we all want it to be."
Monday's results mark the third consecutive quarter of solid profitability for the company, which means the 26,000 members of the United Auto Workers employed in Chrysler's factories are one step closer to receiving the rest of their signing bonus as stipulated by the unions 2011 agreement with the automaker.
"Based on third-quarter earnings, Chrysler Group LLC confirms that it has met three quarters of the financial threshold required to pay the second half of the UAW contract ratification bonus," said company spokeswoman Jodi Tinson in a statement.
If Chrysler's recovery remains on track, those workers will receive a check for $1,750 next year.
Marchionne said Chrysler is still on track to make about $1.5 billion this year and expects free cash flow to be "well in excess of $1 billion."
Chrysler ended the quarter with $11.9 billion in cash — down from $12.1 billion at the end of the second quarter, but up from $9.5 billion a year ago.
The company's gross industrial debt totaled $12.6 billion, up from $12.5 billion as of June 30.
Chrysler has benefited from its focus on the North American automobile market, which is experiencing a modest rebound. Fiat remains heavily dependent on its European business, which has withered in the face of the ongoing economic crisis in the region.
Net revenue for the quarter was 18 percent to $15.5 billion, thanks to a 19 percent increase in shipments. Chrysler shipped 559,000 vehicles during the third quarter compared to 469,000 during the same period in 2011.
Since emerging from bankruptcy in 2009, Chrysler has not only returned to solid profitability, but also announced investments of more than $4.5 billion in the United States and Canada, repaid its government loans in full with interest six years ahead of schedule and launched 18 new or refreshed cars and trucks.
Fiat currently owns 58.5 percent of Chrysler and is trying to purchase another 3.3 percent of the company from its other owner, an hourly retiree health care trust run by the United Auto Workers.
From The Detroit News: detroitnews.com |
