(AOF) – Renault fell on the stock market (-1.18% to 46.91 euros) despite an increase in turnover in the 1st quarter and slightly higher than forecasts. At 11.707 billion euros, it increased by 1.8% (5.9% at constant exchange rates). Jefferies remains a buy with a price target of 47.47 euros, emphasizing that activity is higher than expectations thanks to the financial subsidiary. Renault Group emphasizes that it “continues its value-centered commercial policy” and confirms its 2024 financial outlook.
The financial subsidiary Mobilize Financial Services (formerly RCI Bank and Services) saw its turnover jump 27.9% to 1.24 billion euros. The manufacturer cites the rise in interest rates and the 9.8% increase in average productive assets (54.2 billion euros) over one year.
At the same time, automobile revenues fell by 0.7% to 10.446 billion euros. However, they are up 3.6% at constant exchange rates thanks in particular to a price effect of 4.1 points.
“The high level of the order portfolio at the end of March as well as our upcoming launches will allow the sequential acceleration of activity. Associated with an increased reduction in costs, they will be the levers of our financial performance”, commented Thierry Piéton, director financial advisor of Renault Group. “This is the strongest quarter since 2019 in absolute value,” he underlined during a conference call reported by the economic press.
The group’s global sales increased by 2.6% (to 549,099 vehicles), and by 4.3% in Europe. The share of electric vehicle sales, however, fell to 10.5% for the Renault brand compared to 11% a year earlier. “We have an electric market which remains a little slower than in the predictions made two years ago” commented Thierry Piéton, adding however that “we see the hybrid progressing very strongly”.
As part of its value-centered commercial policy, Renault focuses on sales to individual customers (66% of sales), on the C & higher segments (37% of sales), on high-end versions which represent a large majority of the latest launches and on electrification with hybrid and electric offers (48% of sales)”.
Renault Group expects an operating margin for the group of at least 7.5% and at least 2.5 billion euros in free cash flow. The market anticipates 7.5% and 2.45 billion euros respectively. 2024 will be “a historic year” with 10 new vehicle launches.
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