For the third consecutive quarter, Chrysler Group LLC posted a quarterly operating profit with a $239 million operating profit during Q3 2010 — an increase of $56 million compared to Q2 2010. The 2010 year-to-date operating profit for Chrysler Group is $565 million.
“A year ago, Chrysler Group laid out clear and concise five-year financial goals and after three consecutive quarters of better than forecasted results, we are not only living up to our commitments but we are also exceeding our 2010 financial objectives,” said Sergio Marchionne, Chief Executive Officer, Chrysler Group LLC.
Based on better than forecasted financial results achieved to date, Chrysler Group upgraded its full year 2010 guidance, first provided on Nov. 4, 2009. The new targets for the year are:
- Net Revenues of ~$42 billion (previously $40 – 45 billion)
- Operating Profit of ~$0.7 billion, up from $0.0 – 0.2 billion
- Modified EBITDA of ~$3.3 billion, up from $2.5 – 2.7 billion
- Positive Free Cash Flow of ~$0.5 billion, up from a negative $1.0 billion
The company said it lost $84 million in the third quarter, less than half as much as it lost the previous period and the closest it has come to making money since its short trip through bankruptcy in early 2009.
Having shed much of its liabilities and slimmed down its operations in the reorganization, Chrysler’s biggest burden is interest payments to the American and Canadian governments, which it owes $7.4 billion. Chrysler has paid $899 million in interest this year, including $308 million in the third quarter, resulting in an overall loss of $453 million from January through September.
Before interest and taxes, the company said it earned $239 million in the quarter, bringing its operating profit for the year to $565 million. It also forecast an operating profit of about $135 million in the fourth quarter and $700 million for all of 2010, up from break-even to a $200 million gain.
Chrysler’s sales in the United States are up 16.5 percent in 2010 through October, compared with a 10.6 percent gain across the auto industry. Its market share rose to 9.5 percent, from 9 percent a year ago.
Sales of the redesigned Jeep Grand Cherokee, a model whose success is critical to the company, nearly quadrupled last month in the United States. Chrysler is working to overhaul more of its models to make them more competitive, but that process takes years.
“We are committed to ensuring that every new vehicle this company launches has the same high quality and technological advances as the Jeep Grand Cherokee,” Mr. Marchionne said.
The Grand Cherokee helped Chrysler cut its net loss by more than half from the second quarter to the third and increase revenues 5.2 percent, to $11 billion.
* Courtesy of Chrysler Media Services and NYTimes.com
* Published by JPFreek Jeep Adventure Magazine – The leader in Jeep and adventure enthusiast publications.