GROUPE RENAULT : 2020 FINANCIAL RESULTS
PRESS
RELEASE
#RenaultResults
2020 FINANCIAL RESULTS: A year of contrasts
The strong improvement in operating
profitability in the second half shows the first positive impacts
of the actions taken in the context of a year heavily impacted by
Covid-19.
The results for the second half of 2020
(Group operating margin at 3.5% and positive Automotive operational
free cash flow) mark the first step in the Group's recovery. The
achievement of 60% of the €2 billion savings plan objectives right
from the first year (compared with 30% announced), together with
the implementation of the new commercial policy of the
“Renaulution” strategic plan largely contributed to these
results.
However, Fiscal Year 2020 remains
strongly impacted by Covid-19.
- Sales at 2.95 million units, down -21.3% (-6.8% in
H2).
- Group revenues down -21.7% at €43.5
billion (-18.2% at constant exchange rates1). Group revenues down
-8.9% in H2.
- Group operating margin of -€337 million (-0.8% of
revenues). It was positive at €866 million (3.5% of revenues) in
H2.
- Group operating income at -€1,999 million
(+€8 million in H2). It takes into account
an increase of charges related to competitiveness improvement
(restructuring costs and impairments) for close to a billion
euros.
- Net income of -€8,046 million (-€660 million in H2)
compared to €19 million in 2019.
- Negative Automotive operational free cash flow of
-€4,551 million after a positive contribution of €1,824 million in
H2.
- Groupe Renault achieved its CAFE targets2 (passenger
cars and light commercial vehicles) in Europe where it maintains
its EV leadership.
- The electronic chips shortage impacting the whole auto
industry does not spare the Group. It is entirely dedicated to
limit as much as possible the impact on production. The peak of the
shortage should be reached in Q2. The most recent estimate,
assuming a production catch-up in H2, gives a net risk of about
100,000 vehicles for the year.
- In accordance with the “Renaulution” plan, the Group
will continue the implementation of the actions aiming at its
recovery and confirms the 2023 objectives communicated during the
plan presentation.
“After a first half impacted by the Covid-19,
the Group has significantly turned around its performance in the
second half. This result is the fruit of all employees’ efforts,
the successful acceleration on our fixed cost cutting plan and
pricing policy improvement. The priority is profitability and cash
generation, as announced during our strategic plan « Renaulution ».
2021 is set to be difficult given the unknowns regarding the health
crisis as well as electronic components supply shortages. We will
face these challenges collectively, keeping the momentum towards
recovery we’ve been successfully engaged in since last summer”,
said Luca de Meo, CEO Groupe Renault
Boulogne-Billancourt, February 19, 2021
Group revenues reached €43,474
million (-21.7%). At constant exchange rates, the decrease
would have been -18.2%.
Automotive excluding AVTOVAZ
revenues stood at €37,736 million, down
-23.0%.
The volume effect was -19.2 points. It stemmed
primarily from the health crisis and, to a lesser extent, from our
commercial policy favoring profit over volume.Sales to partners
declined by -5.1 points, also impacted by the health crisis and the
Nissan Rogue production discontinuation. Forex impact was negative
-2.8 points, and related to the devaluation of the Argentinean
peso, Brazilian real and Turkish lira and to a lesser extent to the
Russian rubble. Price effect, up 3.9 points, came from a more
ambitious price policy and measures to mitigate
devaluations.Product mix impacted for 1.1 points thanks to ZOE
sales increase. Effect « others » weighed for -1 point
notably because of lower contribution from spare parts activity,
largely impacted by the confinement measures in H1.
The Group’s operating margin
amounted to -€337 million and represented -0.8% of revenues (4.8%
in 2019) thanks to a marked improvement in H2 (3.5% of
revenues).
Automotive excluding AVTOVAZ operating
margin was down -€2,734 million to -€1,450 million, which
represented -3.8% of revenues compared to +2.6% in 2019. In the
second half, it was positive at €198 million (0.9% of
revenues).
The change can be explained by the
following:
- Volume effect had a negative impact of -€2,556 million,
including sales to partners.
- Mix/price/enrichment effect was positive +€172 million despite
the enrichment of new products and the regulatory content.
- The Monozukuri effect was positive by +€36 million after taking
into account a negative impact of -€479 million due to the increase
in depreciation and amortization and a lower R&D capitalization
rate.
- Raw materials weighed for -€131 million largely on higher
prices for precious metals.
- The improvement of +€172 million of G&A spending stemmed
from the impact of lower activity in H1 but also from the company’s
effort to limit its costs under the « 2o22 » plan.
- Currencies impacted by -€428 million reflecting the devaluation
of our main currencies despite the positive impact of the Turkish
lira on production costs.
The AVTOVAZ operating margin
contribution amounted to €141 million, compared to €155
million in 2019 highlighting the resilience of AVTOVAZ in the
Covid-19 context.
Sales Financing contributed
€1,007 million to the Group’s operating margin, compared to €1,223
million in 2019. This decrease was due to a lower activity, with
new financings down -17% and a cost of risk representing 0.75% of
average performing assets compared to 0.42% last year.
The contribution of Mobility
Services to the Group’s operating margin amounted to -€35
million in 2020.
Other operating income
and expenses amounted to -€1,662 million (compared to
-€557 million in 2019) coming from significantly higher
restructuring charges and impairments.
Group
operating income came to -€1,999
million compared with €2,105 million in 2019 after taking into
account a strong increase of charges related to competitiveness
improvement.
Net financial income and
expenses amounted to -€482 million, compared with -€442
million in 2019, due to higher average indebtedness.
The contribution of associated
companies came to -€5,145 million, compared with -€190
million in 2019. Nissan’s contribution was negative at -€4,970
million and the one of other companies amounted to -€175
million.
Current and deferred taxes
represented a charge of -€420 million compared to a charge of
-€1,454 million in 2019.
Net income
stood at -€8,046 million and net income, Group
share totaled -€8,008 million (-€29.51 per share compared
with €0.52 per share in 2019).
Automotive operational free cash flow,
including AVTOVAZ, was negative at -€4,551 million. It
takes into account the fall in operating margin, the change in
working capital requirements and the absence of dividend received
from RCI following European Central Bank’s decisions. On the sole
second half, the free cash flow was positive at +€1,824 million due
to investment management and a reverse of the change in working
capital requirement, without, however, offsetting the change in the
first half of the year.
The Automotive net cash
position was negative at -€3,579 million at December 31,
2020 compared with a positive position of €1,734 million at
December 31, 2019.
The Automotive activity at December 31, 2020
held +€16.4 billion of liquidity reserves.
At December 31, 2020, total
inventories (including independent dealers) represented
486,000 vehicles, down more than 100,000 units (-19%). It
represented 61 days of sales, compared to 68 days at end December
2019.
The Board of directors will propose at the
Shareholders’ Annual General Meeting, scheduled for April 23, 2021,
not to pay a dividend in respect of 2020.
OUTLOOK
Groupe Renault confirms the 2023 objectives
communicated in the "Renaulution" strategic plan:
- Group operating margin above 3% by 2023,
- Cumulative automotive operational free cash flow3 (2021-23)
about €3bn,
- Investments (R&D and capex) at about 8% of revenues by
2023.
GROUPE RENAULT CONSOLIDATED
RESULTS
In € million |
2020 |
2019 |
Change |
Group revenues |
43,474 |
55,537 |
-12,063 |
Operating margin % of revenues |
-337-0.8% |
2,6624.8 % |
-2,999-5.6 pts |
Other operating income and expenses |
-1,662 |
-557 |
-1,105 |
Operating income |
-1,999 |
2,105 |
-4,104 |
Financial income |
-482 |
-442 |
-40 |
|
|
|
|
Contribution from associated companies |
-5,145 |
-190 |
-4,955 |
o/w: NISSAN |
-4,970 |
242 |
-5,212 |
|
|
|
|
Current and deferred taxes |
-420 |
-1,454 |
1,034 |
Net income |
-8,046 |
19 |
-8,065 |
Net income, Group share |
-8,008 |
-141 |
-7,867 |
Automotive operational free cash
flow |
-4,551 |
153 |
-4,704 |
Additional Information
The consolidated financial statements of Groupe
Renault and the company accounts of Renault SA at December 31, 2020
were approved by the Board of Directors on February 18, 2021. The
Group’s statutory auditors have conducted an audit of these
financial statements and their report will be issued shortly.The
earnings report, with a complete analysis of the financial results
in 2020, is available at www.group.renault.com in the "Finance"
section.
About Groupe RenaultGroupe
Renault is at the forefront of a mobility that is reinventing
itself.
Strengthened by its alliance with Nissan and
Mitsubishi Motors, and its unique expertise in electrification,
Groupe Renault comprises 5 complementary brands - Renault, Dacia,
LADA, Alpine and Mobilize - offering sustainable and innovative
mobility solutions to its customers. Established in more than 130
countries, it currently employs more than 180,000 people and has
sold 2,95 million vehicles in 2020.
Ready to pursue challenges both on the road and
in competition, Groupe Renault is committed to an ambitious
transformation that will generate value. This is centered on the
development of new technologies and services, and a new range of
even more competitive, balanced and electrified vehicles. In line
with environmental challenges, the Group’s ambition is to achieve
carbon neutrality in Europe by 2050.
For further information, please contact:
Astrid de
Latudeastrid.de-latude@renault.comCorporate Press Officer
+33 6 25 63 22 08
Delphine Dumonceau-Costes
Delphine.dumonceau-costes@renault.comCorporate Press Officer +33 6
09 36 40 53
1 In order to analyze the change in consolidated revenues at
constant exchange rates, Groupe Renault recalculates revenues for
the current year by applying the average annual exchange rates of
the previous year.
2 These results should be consolidated and formalized by the
European Commission in the coming months. CAFE = Corporate Average
Fuel Economy3 Automotive operational free cash flow: cash flows
after interest and tax (excluding dividends received from publicly
listed companies) minus tangible and intangible investments net of
disposals +/- change in the working capital requirement
- GROUPE RENAULT FY 2020 FINANCIAL RESULTS PR DEF
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