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February 21, 2025
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Renault beats profit forecast for 2024

Renault has so far stuck to its targets, helped by an overhaul of its manufacturing layout and strategy started in 2020.
French automaker Renault reported a record operating profit for 2024 on Thursday, beating expectations, as lower costs and a string of new launches boosted margins.

The company, one of the few in the sector to have maintained its targets last year, reported operating profit of 4.3 billion euros (USD 4.49 billion), up 3.5% on the previous year, and above a company-compiled consensus forecast of 4.2 billion euros.

Its revenue rose 7.4% to 56.2 billion euros, well ahead of the expected 54.5 billion euros, driven by launches including the popular compact electric R5 and a range of new hybrids.

Renault reported an operating margin for 2024 of 7.6%, meeting its target of at least 7.5% for the year.

However, it lowered margin expectations this year to at least 7%, noting that tough new European carbon emissions targets would erode 1 percentage point from its margin, equivalent to about 500 million euros of operating profit.

The company remains "hopeful" the rules will be relaxed, CFO Thierry Pieton told journalists, but was not counting on that for its financial forecasts.

It expects to spend on discounts to sell more electric vehicles while also raising the prices of petrol cars to help it meet the targets, he said, but it continues to rule out pooling its emissions with other car makers.

Renault was one of the only major car manufacturers that did not issue a profit warning last year, as a global decline in demand for new cars and operational issues hit larger peers like Volkswagen and Stellantis hard.

Top European automaker Volkswagen warned on profit twice last year before entering months of negotiations with unions over a plan to cut thousands of jobs and reduce capacity to help it lower costs.

Stellantis also issued a profit warning in September after struggling to turn around poor performance in the U.S., leading to the resignation of its CEO months later.

Renault has so far stuck to its targets, helped by an overhaul of its manufacturing layout and strategy started in 2020.

Under CEO Luca de Meo, it has joined up with other companies to share investment costs, and also revamped its vehicle lineup, launching 10 new models in 2024 with plans for seven more this year.

However, its 2024 net income on a group share basis fell to 752 million euros from 2.2 billion euros a year earlier after accounting for disposal of shares in Japanese automaker Nissan , a partial impairment on its investment in the firm, and a much lower contribution from its earnings.

Renault said it would pay a dividend of 2.2 euros, compared to 1.85 euros for 2023.