(News Bulletin 247) – The diamond group published its preliminary results and lowered its prospects for 2025.

Renault makes a “warning profit” (warning on results in French). The diamond group published preliminary half -yearly results and lowered its prospects for 2025.

The company is now counting for this year on an operating margin around 6.5% compared to at least 7% previously. Renault also expects a free cash flow between 1 billion and 1.5 billion euros against at least 2 billion euros before.

Renault spoke of “the deterioration of the dynamics of the automotive market with increased commercial pressure from its competitors and the anticipation of the continuation of the retail market (the individual channel, as opposed to the rental companies or the business fleets, editor’s note)” to justify this decision.

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Disappointing volumes

The financial director, Duncan Minto, who has just been appointed interim managing director, told analysts that commercial pressure was particularly felt at the end of the semester in June.

The manager spoke of volumes “slightly lower than expected” but also the underperformance of commercial vehicles in market “in pronounced decline in Europe”.

Faced with the deterioration of this environment, the French manufacturer indicated that he intended to continue to favor value to volumes at the level of its commercial policy. The company also intends to strengthen its cost reduction plan.

“This plan is mainly based on a drop in SG & A (general and administrative costs) and production costs and R&D. The details will be communicated when presenting the half -yearly results”, at the end of July, explains Renault.

Cash Cash

In terms of its preliminary financial results, Renault said it had made income of 27.6 billion euros over the first six months of 2025, up 2.5%.

The operating margin registered at 6% against 8.1% a year earlier.

The cash flow has proven to be low, with a free cash flow of only 47 million euros, weighed down by a variation in working fund need for 900 million euros.

This variation is explained by higher production, but also larger stocks themselves due to the disappointing level of volumes in June.

Duncan Minto explained that these figures translated “a gap with market expectations”. The manager indicated that analysts (consensus) were tabling on income of 27.5 billion euros, an operating margin of 6.9% and a cash flow of 645 million euros.

All of these announcements have a good chance of receiving an icy reception at the opening of the Paris Stock Exchange on Wednesday.

Renault had organized a “pre-closed” conference (held before the preliminary reserve period for the publication of results) with analysts on July 1. The diamond group then convinced the analysts.

“Management has generally sent a positive message and confirmed its 2025 objectives,” said Adrien Brasey, analyst at the independent alphavalue design office. Bernstein analysts also indicated that the company had confirmed its targets.

On the New York Stock Exchange, the ADR (certificates of deposits, titles which allow American investors to position themselves on titles of foreign companies) fell 2.5% as a result of these announcements.

This warning on results occurs the same day Luca de Meo, the emblematic managing director of Renault, left the company, the manager preparing to take the controllers, on September 15, of the luxury group Kering. While waiting for a successor to be officially appointed, Duncan Minto was therefore appointed interim managing director.

“The selection process of the new director general of Renault is already well underway, under the supervision of the governance committee and remuneration of the board of directors,” said Renault on Tuesday.

Duncan Minto admitted that “the timing of these announcements (the warning on results) was unhappy” but assured that it had nothing to do with the announcement of Luca de Meo’s departure.