PSA Peugeot Citroën delivers €1.2bn on back of successful turnaround plan
French carmaker hits medium-term goals early in the wake of 2012 bailout
Carlos Tavares, chief executive of PSA Peugeot Citroen, has led the successful turnaround plan at the French carmaker
PSA Peugeot Citroën said on Wednesday it would consider paying a dividend for 2016 after reaching its medium-term targets ahead of schedule, helped by cost cuts, price increases and a recovery in European demand.
Following a successful turnaround plan on the back of a €3 billion bailout in 2012, the French carmaker said its automotive division hit a 5 per cent operating margin, a goal it had set for 2019-23.
The turnaround has been engineered by Chief Executive Carlos Tavares who said: “I am delighted with this collective success. It puts our company back in the race and proves its potential.”
The company posted a full-year net profit of €1.2 billion, reversing a €555 million loss in 2014. Group recurring operating income more than tripled to €2.7 billion.
Tavares overhauled Peugeot in the wake of the bailout which saw the French government and China’s Dongfeng each buy 14 per cent stakes. Tavares pledged to cut labour costs, inventory and model line-ups to restore profitability. PSA said it would not pay a dividend for 2015 but that a dividend policy “in line with sector practices” would be proposed from the 2016 financial year.