Renault Drives Out of Last Years Slump Harold Cunningham, Getty Images

Renault Drives Out of Last Year's Slump

Renault reported first-half net profits nearly 20 times better than during the slump of last year.

PARIS - Renault (IW 1000/80) on Tuesday reported first-half net profits nearly 20 times better than during the slump of last year as European sales offset weaker growth in emerging markets.

Renault reported net profits of 749 million euros (US $1 billion) in the first six months of the year, compared to a meager 39 million euros it achieved in the first half of 2013 when its figures were hit by the ending of its business in Iran.

Chief Executive Carlos Ghosn said in a statement that his group's profits and registrations had improved in the first half "thanks to the success of...recently launched models."

"These results are in line with the full-year target," added Ghosn.

Renault sold 1.36 million new cars in the six months to June, a gain of 4.7% compared to the outcome in same period last month.

"In the first half of the year, the strong performance of the group in Europe, driven by the success of new models...enabled the group to offset the sharp slowdown in its main emerging markets," Renault said.

Despite this, turnover was actually down 3%, at 19.8 billion euros -- a decline the company blamed on "adverse" currency market moves.

Brokers Aurel BGC commented that the operating profit was above the general figure expected by analysts.

But sales were disappointing as was a negative figure for cash generated by operations, known as free cash flow, of 360 million euros in the first half, more than 10 times the equivalent figure last year, Aurel BGC said.

At Bank of America-Merrill Lynch, analysts also commented that this figure was unduly weak.

Copyright Agence France-Presse, 2014

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