July 24, 2018 / 5:31 AM / a year ago

PSA posts profit gain as Opel turnaround takes root

PARIS, July 24 (Reuters) - French carmaker PSA Group said first-half earnings rose 18 percent, beating analyst expectations, as it returned the newly acquired Opel-Vauxhall business to profit.

Net income rose to 1.481 billion euros ($1.73 billion) as revenues jumped 40 percent to 38.6 billion euros, the Peugeot maker said in a statement.

“The turnaround of Opel-Vauxhall is now clearly underway,” Chief Financial Officer Jean-Baptiste de Chatillon told reporters on a call.

The business acquired last year from General Motors posted a 502 million profit amounting to a 5 percent profit margin, while the French group’s existing automotive business lifted profitability to 8.5 percent.

The group’s overall recurring operating profit rose by almost half to 3.02 billion euros.

The results beat analyst expectations of 2.33 billion euros in operating profit and 1.364 billion in net income on revenue of 38.49 billion, based on the median estimates in an Inquiry Financial poll for Reuters.

$1 = 0.8560 euros Reporting by Laurence Frost and Gilles Guillaume; Editing by Sudip Kar-Gupta

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