Published - February 22, 2023 @ 2:58 PM (EET)
In a year of a steep rise in electric-vehicle sales, Stellantis NV (NYSE:STLA) unveiled a buyback of as much as $1.6 billion and its plans to distribute $4.47 billion in dividends to shareholders following solid results.
On Wednesday, the maker of the Jeep and Dodge brands posted revenue of $191 billion, an 18% increase on the year. Up 41% from the year prior, Stellantis sold 288,000 electric vehicles globally in 2021 amid high vehicle prices and pent-up demand.
Net profit increased 26% to $17.9 billion, while adjusted operating income climbed 29% to $24.8 billion. Free cash flow came in at $11.48 billion, up 78%, showing early progress towards reaching the more than $21.5 billion objective for 2030.
Chief Executive Carlos Tavares said,
"In addition to our financial results and the focused execution of the Dare Forward 2030 strategic plan, we also demonstrated the effectiveness of our electrification strategy in Europe."
WHY IT MATTERS
Stellantis forecasted another year of double-digit adjusted operating income margin and positive industrial free cash flows as the carmaker anticipates vehicle price increases to slow this year compared with 2022.
For 2023, Stellantis expects industry sales to climb 5% in both North America and Europe. Chief Financial Officer Richard Parmer said while inflation will continue to be a challenge, he argued that the hit would be a "significantly lower number in 2023" due to the effect of raw materials and steel and base metals.
In addition, formed by the fusion of Fiat Chrysler and Peugeot maker PSA Group, Stellantis aims to increase its EV portfolio to 47 models by the end of 2024 and reach a global sales target of 5 million units by 2030.
"We now have the technology, the products, the raw materials, and the full battery ecosystem to lead that same transformative journey in North America, starting with our first fully electric Ram vehicles from 2023 and Jeep from 2024", Tavares said.
In a note to investors, Bernstein analysts wrote, "Stellantis's raised dividend and a new share buyback are positive signals to investors but also leave room for improvement."
The automaker said its 2022 dividend distribution is subject to shareholder approval and would execute its share buyback by 31 December 2023.
