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Peugeot Losses Pass €1 billion; 2010 Should Improve

Peugeot Losses Pass €1 billion; 2010 Should Improve
Merrill Lynch Expects EBIT Close To €1 Billion

Peugeot-Citroen’s net loss increased in 2009 to €1.2 billion from €363 million the previous year, but despite warning that European sales will be weak in 2010, and admitting that it is too Eurocentric in its market coverage, it expects to make an operating profit in the first of the year.

The company didn’t say how much.

Morgan Stanley said, even though it was disappointed with the company’s performance in 2009, most analysts expect a profit for all of 2010.

“Peugeot Citroen expects Europe to be down nine per cent but expects to gain share because of new model launches,” Morgan Stanley said.

Merrill Lynch expects Peugeot-Citroen to earn close to €1 billion in 2010, although it cut its EBIT forecast for the year to €971 million from a previous expectation of €1.3 billion.

Deutsche Bank said Peugeot-Citroen faces two major uncertainties.

“(Peugeot-Citroen has) the strongest exposure to Western Europe, which will likely suffer the most this year after negative payback to government incentives, and the potential acquisition of Mitsubishi Motors, which could be dilutive and costly,” Deutsche Bank said.

Neil Winton – February 15, 2010

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