Chrysler posts $690 million Q1 net loss on merger costs
Profit without one-time charges was $486 million
DETROIT -- Chrysler Group reported a net loss of $690 million in the first quarter as it paid costs associated with its completed merger with Fiat. The net loss was the first for Chrysler since the second quarter of 2011.
Without the two unusual charges associated with its merger, profit was $486 million, Chrysler said in a report today. A year earlier, Chrysler posted a net profit of $166 million.
During a brief conference call with analysts today, Chrysler CFO Richard Palmer said the automaker was confirming its guidance for the year and expected to generate about $80 billion in revenues and about $2.4 billion in profits before one-time charges.
Chrysler said it took a $504 million loss on the elimination of debt related to the prepayment of its note with the UAW Retiree Health Care Trust. It also took a $672 million charge for commitments it made in the New Year’s Day transaction that allowed Fiat S.p.A. to purchase the UAW VEBA’s remaining shares of Chrysler.
Chrysler had the largest market share gain of any major automaker during the first quarter, gaining 1.1 percentage points in the United States over the same period a year ago to 12.7 percent on U.S. sales of 476,000 vehicles.
The automaker’s U.S. sales were up 11 percent during the first three months of 2014 as a 30 percent gain in pickup and SUV sales offset a 30 percent decline in car sales.
Globally, Chrysler said it delivered 668,000 vehicles in the quarter, including vehicles it makes for other automakers, such as parent company Fiat.
First-quarter revenue grew 23 percent to $19 billion.
The company reported cash of $12.4 billion, up from the $11.9 billion one year ago. Chrysler said it had a gross industrial debt of $12.9 billion, up from the $12.5 billion it had at the same point in 2013.
Fiat Chrysler Automobiles executives spent about 10 hours with analysts on May 6 going over the combine company's business plan for the next five years in detail.
Palmer also said that Chrysler had spent about $100 million during the first quarter on recalls, and that the automaker didn’t have a capacity constraint on its recently launched Ram 1500 EcoDiesel pickup. CEO Sergio Marchionne did not participate on the call.
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