(News Bulletin 247) – The automobile manufacturer managed to achieve revenue growth of 1.8% in the third quarter with an increase of 2.6% excluding currencies in its automobile division. The company benefited from its recent launches and confirmed its outlook for the current financial year.

Despite itself, Renault had found itself in the market’s sights recently. A dizzying number of European automakers – Aston Martin, Volkswagen, BMW, Stellantis, Mercedes-Benz – issued profit warnings last month.

Investors feared that Renault would be next on the list and in turn lower its outlook before or in the wake of the publication of its third quarter sales figures.

But these fears did not materialize. This Thursday, the diamond group, on the contrary, confirmed its objectives for 2024 and recorded revenues higher than expectations.

>> Access our exclusive graphic analyses, and gain insight into the Trading Portfolio

The strength of new launches

From July to the end of September, Renault generated turnover of 10.7 billion euros, up 1.8% year-on-year and 5% excluding currency effects. The Stifel bank expected revenues to fall over one year and slightly below 10 billion euros. Bernstein, for his part, cites a consensus of 10.35 billion euros.

For several quarters, Renault’s growth has been driven by financial services, with its Mobilize Financial Services division. This activity also recorded an increase of 21.6% year-on-year in the third quarter.

But the automotive division also posted notable performances during a third quarter which was nevertheless marked by the deterioration of the economy.

Automotive turnover stood at 9.3 billion euros, down 0.5% year-on-year in published data but up 2.6% adjusted for currency effects. Stifel expected revenues to fall 8.7% to 8.6 billion euros while the consensus was at 9.06 billion euros, according to Bernstein.

Renault was penalized by a negative volume effect of 3.1 percentage points with a 5.6% decline in registrations. Prices had little impact (+0.2 points), with the company stabilizing its prices.

The two sources of outperformance come from ancillary activities (after-sales, spare parts) and above all from the “mix”, that is to say the distribution of sales towards more expensive and better-margined models. This mix had a positive impact of 3.8 percentage points in the third quarter thanks to recent launches, such as the electric Scénic and the Rafale.

This bodes well as the next quarter will be supported by the launch of the electric R5, a modern version of Renault’s flagship model from the 70s and 80s.

Against the competition

“Our third quarter revenue is starting to benefit from our unprecedented product offensive, with 10 new vehicle launches this year, representing 18% of quarterly billings,” said financial director Thierry Piéton, quoted in a press release from press. “This trend will continue over the coming quarters, in line with the gradual introduction of vehicles into their respective markets. It will further accelerate thanks to the 7 new launches planned in 2025,” he added.

During a conference call with analysts, the manager stressed that the order intake made the group confident about a “robust” volume effect for the fourth quarter of 2024.

At the end of this quarter, the diamond group therefore confirmed its objectives for 2024, namely an operating margin at least equal to 7.5% and an automobile free cash flow of at least 2.5 billion euros.

On first reading, Bernstein judges that these results are “positive”, appreciating that Renault has “crucially” confirmed its objectives for 2024. Which “sets Renault apart from its competitors who issued warnings on results”, before the publication season, underlines the financial intermediary.

For Oddo BHF, Renault represents “a clearing” in a very cloudy (or even rainy) European automotive landscape.

On the Paris Stock Exchange, Renault shares rose 4% at the start of the session following these announcements.

Incidentally, Thierry Piéton indicated that the corporate tax surcharge provided for in the Finance bill for 2025 by the executive would only have a modest impact of the order of “a few million euros” .