PARIS – Carmaker Renault said on Friday it registered a loss last year for the first time in a decade with a 141-million-euro ($153-million) deficit, owing to the contribution collapse of its Chinese partners, Daimler, and especially Nissan, but also that of its own car activity.
The results, presented as part of its annual review, are a stark contrast to its 3.3-billion-euro profit in 2018.
Nissan only contributed 242 million euros to Renault’s 2019 results, after the 1.5 billion it registered in 2018, the French group said in a statement.
As for the Chinese and Daimler, they made a joint 432 million-euros loss compared to 2018’s 31-million-euro profit.
Renault itself posted a 2.1-billion-euros profit, compared to 2.9 billion euros in 2018, while turnover decreased 3.3 percent to 55.5 billion.
Consequently, the operating turnover margin remained at 4.8 percent, 1.5 percentage points less.
Excluding financial activity (loans for the purchase of vehicles), in which profitability improved slightly, the operating margin of the pure automobile business (other than Russian subsidiary Avtovaz) was reduced to 2.6 percent after 4.3 percent in 2018.
All this reflects the sinking of Renault’s sales in important markets such as Argentina, Turkey and Algeria. The registrations of the rhombus group fell 3.4 percent globally with 3.8million cars.
In addition, the manufacturer had to fit a negative effect due to the decrease in the weight of diesel vehicle registrations.
The operating cash flow of the automobile business was reduced to 153 million euros, compared to 607 million the previous year.
The Renault board will propose to the board the distribution of a 1.10-euro dividend per share, which means less than a third of the 3.55 percent distributed on account of 2018.
Prospects are less favorable in view of automobile market forecasts, for which it predicts a fall on a global scale, with a decrease of at least 3 percent in Europe and a 3 percent in Russia, which cannot be compensated by the 5 percent rise in Brazil – a key country for the company.
Excluding a possible impact from the COVID-19 outbreak, Renault estimates its 2020 turnover will be similar to that of 2019 and that its operating margins will remain at a 3 percent to 4 percent bracket, with positive cash flow before accounting for restructuring costs.