Fiat Industrial, the Italian maker of trucks, farm and construction vehicles, returned to profit in the first quarter of the year as all sectors recovered but its performance was not as strong as expected and its share price dropped.
Fiat Industrial Spa, spun off from Fiat Group earlier this year, said Thursday net profit in the quarter was euro114 million ($166 million), in contrast with last year's equivalent loss of euro34 million. However, the profit posted was not as high as anticipated _ the consensus to analysts polled by FactSet was for profit of euro133 million.
Fiat Industrial shares dropped 1.5 percent to euro9.99 after the results were released.
A more detailed look at the figures shows that the company, which is based in the northern Italian city of Turin, reported a 19 percent increase in revenue to euro5.3 billion, with double-digit increases in all sectors.
And trading profit _ or earnings before interest, taxes and one-time items _ more than doubled to euro277 million from euro122 million.
By sector, Fiat Industrial said its agricultural and construction equipment unit CNH, posted a 67-percent increase in trading profit to euro213 million on higher volumes and prices and a better mix. Farm equipment sales were up in all major markets due to higher food prices, while construction equipment benefited from improved demand in North and South America as well as Asia.
The Iveco trucks division saw its trading profit spike from euro3 million to euro71 million, reflecting higher volumes. Revenues were up 25 percent to euro2.1 billion, as Iveco delivered 34,392 vehicles worldwide, a 28 percent increase over the same quarter a year earlier. Deliveries were up 22 percent in Western Europe, which represents 60 percent of all truck sales.
Fiat confirmed 2011 targets of euro22 billion in revenues, a trading profit between euro1.2 billion and euro1.4 billion, and a net profit of euro600 million.