Chrysler Q3 profits surge to $611M but per-unit profits trouble

Chrysler Group has announced its third-quarter financial results a little later than its crosstown rivals at General Motors and Ford, but the company has reason to celebrate thanks to strong numbers across the board.

The biggest attention-grabber from the automaker is that its net income was up 32 percent in the third quarter to $611 million, compared to $464 million over the same period last year. Modified operating profit was also strong at $946 million – a 10 percent gain. Furthermore, net revenue grew as well to $20.7 billion – 18 percent higher Q3 2013.

Growing sales pushed the strong financials. Chrysler Group sold about 711,000 vehicles worldwide for the quarter, up 18 percent from a year ago. Things looked especially good in the US, where its market share grew to 12.3 percent, versus 11.2 percent in Q3 2013.

While those figures all look rosy, some analysts aren't completely convinced. According to The Detroit Free Press, there is concern that Chrysler Group only has a 4.6-percent profit as a percentage of its sales here, versus 9.5 percent for GM and 7.1 percent for Ford. The Auburn Hills automaker maintains that the discrepancy exists because it sells fewer vehicles than its competitors and therefore spends comparatively more per vehicle on marketing. While Chrysler Group and GM both showed strong financial results for the quarter, Ford posted a 34 percent dip in net income.

Scroll down to read full press release from Chrysler about its Q3 results.
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Chrysler Group reported net income of $611 million in the third quarter, up 32 percent from a year ago

Net revenue for the third quarter was $20.7 billion, up 18 percent from a year ago

Modified Operating Profit(b) grew 10 percent to $946 million for the quarter, from $862 million a year earlier

Free Cash Flow(e) for the quarter was positive $412 million, up from negative $343 million a year ago

Cash(d) at Sept. 30, 2014, was $13.6 billion

Net Industrial Cash(f) at the end of the quarter was $680 million, up from Net Industrial Cash of $331 million at June 30, 2014, and Net Industrial Debt(f) of $888 million at Sept. 30, 2013

Worldwide vehicle shipments were 700,000 for the quarter, up 18 percent from 593,000 a year ago

Worldwide vehicle sales for the quarter were 711,000, up 18 percent from 603,000 a year ago

U.S. market share was 12.3 percent for the quarter, up from 11.2 percent a year ago; market share in Canada was 14.9 percent for the quarter, up from 14.3 percent a year ago

Full-year 2014 guidance is confirmed

November 5, 2014 , Auburn Hills, Mich. - Chrysler Group LLC today reported preliminary financial results for the third quarter and the first nine months of 2014, including net income of $611 million for the quarter, up 32 percent from $464 million in the same quarter a year ago.

Adjusted Net Income(a) for the first nine months of 2014 was $1.7 billion, up from $1.2 billion in the first nine months of 2013. The Adjusted Net Income of $1.7 billion excludes the unfavorable effects of infrequent items recorded in the first quarter of 2014, related to the Company's prepayment of a note held by the UAW Retiree Medical Benefits Trust (VEBA Trust Note) and a charge for commitments associated with the January memorandum of understanding signed with the UAW. Including the infrequent items, net income for the first nine months of 2014 was $540 million.

Net revenue for the third quarter was $20.7 billion, up 18 percent from $17.6 billion a year ago. Net revenue for the first nine months of the year was $60.1 billion, up from $50.9 billion a year ago. The increase in third-quarter year-over-year revenues was driven by higher shipments, in particular from the all-new Jeep Cherokee and all-new Chrysler 200.

Modified Operating Profit was $946 million in the third quarter, or 4.6 percent of net revenue, up 10 percent from $862 million in the prior-year period. The increase was mainly the result of higher shipment volumes, improved net pricing and purchasing efficiencies, partially offset by higher industrial costs due to vehicle content enhancements and higher warranty costs, principally due to recall campaigns. Modified Operating Profit for the first nine months of 2014 was $2.5 billion, or 4.2 percent of net revenue, up from $2.1 billion in the first nine months of 2013.

To read the full financial results release, please click on the pdf to the right.

About Chrysler Group LLC
Chrysler Group LLC, a wholly owned subsidiary of Fiat Chrysler Automobiles N.V. (FCA), designs, engineers, manufactures, distributes and sells vehicles under the Chrysler, Jeep, Dodge, Ram and FIAT brands, and the SRT performance vehicle designation. The Company also distributes the Alfa Romeo 4C model and Mopar products. With the resources, technology and worldwide distribution network required to compete on a global scale, FCA builds on Chrysler Group's culture of innovation, first established by Walter P. Chrysler in 1925, and Fiat's complementary technology that dates back to its founding in 1899.

FCA, the seventh-largest automaker in the world based on total vehicle sales in 2013, is an international automotive group engaged in designing, engineering, manufacturing, distributing and selling vehicles and components and production systems. FCA is listed on the New York Stock Exchange under the symbol "FCAU" and on the Mercato Telematico Azionario under the symbol "FCA."

Chrysler Information


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