Fiat Chrysler Automobiles' assembly workers are manufacturing protective masks against the spread of coronavirus disease (COVID-19) at the assembly plant in Betim near Belo Horizonte, Brazil on May 20, 2020.
Washington Alves | Reuters
Fiat Chrysler announced on Friday that it lost $ 1.24 billion in the second quarter as the corona virus caused shutdowns at its plants around the world.
The company exceeded Wall Street earnings expectations, but missed sales, which fell 56% year over year. In this way, Fiat Chrysler has developed against Wall Street expectations based on refinitive estimates from average analysts.
Adjusted EPS: A loss of 77 cents (65 cents) per share versus an expected loss of $ 1.36 per share. Revenue: expected $ 13.88 billion ($ 11.71 billion) versus $ 17.54 billion ($ 14.78 billion).
Adjusted for pre-tax, Fiat Chrysler reported a loss of approximately $ 1.1 billion in the second quarter. The automaker managed to generate a $ 46.2 million profit on its North American operations. Everyone else was in the red.
The shares of the Italian-American automaker remained unchanged on Friday during premarket trading. The stock closed at $ 10.50 on Thursday, down 3.9%.
Fiat Chrysler spent $ 5.8 billion in the second quarter – a number closely followed by Wall Street.
The company's worldwide vehicle sales declined by 63% to 424,000 units from April to June due to pandemic production downtimes and demand disruptions.
"While the company continues to pay attention to employee health and safety, our factories operate, retailers sell in showrooms and online, and we have the flexibility and financial strength to push ahead with our plans," said Mike Manley, CEO of Fiat Chrysler said in a press release.
The company has also taken several steps in the past few months to support its balance sheet. At the end of the quarter, the company's automotive division had liquidity of $ 20.75 billion. The Italian government guaranteed the auto maker loans of $ 7.5 billion at the end of June, of which $ 5.3 billion had not yet been exhausted.
Fiat Chrysler reaffirmed its expectation of a 50:50 merger with French automaker PSA Group in the first quarter of next year, subject to approval by the board and regulators. The name of the merged company is Stellantis.
Fiat Chrysler's profits follow rivals General Motors and Ford Motor of Crosstown, both of which exceeded Wall Street's earnings expectations in the second quarter.