Peugeot maker PSA Group posted a higher-than-expected rise in 2019 revenue on Wednesday, although the volumes of cars sold declined, with the French firm saying it anticipated sliding demand in Europe and Russia this year.
The auto group, which is working through a merger with Italy’s Fiat Chrysler, has relied on selling pricier models like SUVs to boost earnings at a time when revenues have faltered at many rivals.
PSA said group revenue came in at 74.7 billion euros ($81.2 billion), up 1% from a year earlier and slightly above the average of 74.2 billion euros seen in a Refinitiv poll of analysts. Operating margins reached a record 8.5%.
Net profit increased 13.2% to 3.2 billion euros, and the company increased its dividend against 2019 results to 1.23 euros per share, up 58% from 2018 levels.
Speaking to CNBC’s Charlotte Reed in Paris Wednesday, Chairman Carlos Tavares noted that Groupe PSA posted its best ever operating profit margin rate last year.
“I’m very happy for 2019,” he said. “We are ready for the next challenges of our company.”
One of those challenges, he acknowledged, was the spread of the new coronavirus from China to Europe.
“It’s clear this is a big risk for the whole industry,” Tavares said. “Our situation so far is good, we have been keeping our plants running … we are of course very focused on fixing all the logistic issues, all the supply issues that everybody is facing.”
“I think that the DNA of our company is very much aligned with this kind of situation,” he added. “We wish this can be fixed as soon as possible, but as it is a problem that is imposed on all the carmakers, I think PSA Groupe with its well known agility is in a good situation to face this.”