PARIS—French car maker PSA Peugeot Citroë n said Wednesday it
turned a profit for the first time since 2011 as higher prices,
favorable foreign exchange rates and improved efficiency boosted
the bottom line.
It posted a profit of €571 million ($632.43 million) for the
first half of 2015 compared with a loss of €114 million a year
earlier.
Peugeot said revenue during the six-month period rose 6.9% to
€28.9 billion and that its car manufacturing and sales generated an
operating free cash flow of €2.7 billion.
"We are going faster than our plan," said Chief Financial
Officer Jean-Baptiste de Chatillon, referring to the company's
"Back in the Race" restructuring plan that kick-started last
year.
Mr. de Chatillon said the automotive division's operating profit
margins rose to 5%, far ahead of the targeted 2% it sought to reach
by the end of the three-year plan. He said that one-third of the
increased profitability came from favorable external conditions,
such as advantageous foreign exchange rates and lower prices for
oil and other raw materials.
While sales growth in Asia has slowed considerably—it sold just
2.2% in the China and Southeast Asia region—Mr. de Chattilon said
that it improved its profit margins in China to 9% from 7%. The
country emerged last year as the company's largest market,
outpacing demand in its home of France.
The company adjusted its global outlook for auto sales. It now
thinks European sales will rise 6% while demand in China will grow
just 3%. It added that overall car sales will decline 15% in Latin
America and 35% in Russia. At the beginning of the year, Peugeot
forecast a 1% increase in Europe, a 7% rise in China and a 30%
decline in Russia.
Write to Jason Chow at jason.chow@wsj.com
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