As European sales dropped for a fourth year and price rivalry intensified, Renault posted a flat profit in 2011. Earnings before taxes, interest and one-time items declined 0.7% to 1.09 billion euros or $1.42 billion from 1.1 billion euros a year ago, the automaker disclosed. The average forecast of 20 analysts that Bloomberg has surveyed was for a 1.09 billion euros profit.
CEO Carlos Ghosn stated that Renault coped with the various crises that it faced throughout the year, surpassing the free cash flow goal for 2011.
Renault and French rival PSA/Peugeot-Citroen executed work stoppages last year in order to decrease inventory size in the face of uncertain market conditions. Renault anticipates that the European market will contract from 3% to 4% this year, marking the fifth straight annual drop.
The worldwide deliveries of Renault advanced by 3.6% in 2011 to a record 2.72 million light trucks and cars as rising markets more than offset for the decreases in Europe.
Renault disclosed that revenue increased 9.4% to 42.6 billion euros from 39 billion euros a year ago. Its automotive free cash flow leaped to 1.08 billion euros at the end of last year, exceeding a goal of 500 million euros. The automaker aims for a positive free cash flow this year for the automotive unit.