First-half 2013 financial results

• Group revenues of 20,441 million, down 0.9% on first-half 2012.
• Group operating margin of €583 million (2.9% of revenues), compared with €508 million [1] (2.5% of revenues) in the first half of 2012.
• Group operating income at a negative €249 million in the first half of 2013 (compared with a positive €545 million in the first half of 2012), after recognizing other operating income and expense items, amounting to a negative €832 million. In particular, the Group recorded a provision of €512 million which covers its entire exposure in Iran.
• Net income of €97 million, compared with €774 million in the first half of 2012.
• Automotive operational free cash flow slightly negative at €31 million.
• Automotive net cash position of €732 million at end-June 2013.
• Group registrations of 1.3 million units (down 1.9% on first-half 2012). International [2] growth was not sufficient to offset the continued weakness of sales in Europe, and France in particular.

Commenting on the results, Carlos Ghosn , Chairman and Chief Executive Officer of Renault, said: “In a difficult environment, the success of new models, cost controls and the commitment of all the teams enabled the Renault group to post a positive operating margin for the Automotive in the first half year. We are on track to achieve the objectives we announced for 2013.”

Group revenues came to €20,441 million in the first half of 2013, down 0.9%. Continued international growth was not sufficient to offset the weakness of the European market.

The Automotive division contributed €19,383 million to revenues, down 0.9% on first-half 2012, mainly due to a negative currency effect and a decrease in registrations. The drop in registrations was lessened by the increase in independent dealer inventories.

The Group saw a positive product-mix effect, stemming notably from the launch of new vehicles, and a positive price effect. The Group is pursuing with it strict pricing policy in order to improve the value of the Renault brand and offset the weakness of certain currencies.

Group operating margin came to €583 million in the first half of 2013, compared with €508 million1 in the first half of 2012, and accounted for 2.9% of revenues, compared with 2.5% in the first half of 2012.

The Automotive division posted a positive operating margin of €211 million (1.1% of revenues), up €95 million compared to the first half of 2012. Despite negative volume and currency effects, the Group benefited from its pricing policy and cost controls.

Sales Financing contributed €372 million to Group operating margin, compared with €392 million1 in the first half of 2012. The €20 million decrease was due to an unfavorable currency effect in Brazil and a slight rise in distribution costs while the cost of risk improved to 0.40% of average performing loans (versus 0.44% in the first half of 2012).

Other operating income and expense items came to -€832 million, mainly due to a provision of €512 million which covers the Group’s entire exposure to Iran; to €227 million in impairment charges for certain vehicle programs, and €173 million in restructuring costs related to the competitiveness agreement signed in France. Operating income came to -€249 million, compared with €545 million in the first half of 2012.

The contribution of associated companies, mainly Nissan, came to €749 million in the first half of 2013.

Net income came to €97 million while net income, Group share, came to €39 million (€0.14 per share compared with €2.70 ³ in the first half of 2012).

Automotive operational free cash flow was slightly negative at €31 million, including €138 million increase in the working capital requirement since December 31, 2012. Total inventory represented 67 days of sales compared with 65 at end-December 2012.

The Automotive division’s net cash position came to €732 million on June 30, 2013, down €800 million since December 31, 2012.

RCI Banque continued to diversify its refinancing through its retail savings account business, with net collected savings totaling €2.6 billion in France and Germany at the end of June 2013.

2013 OUTLOOK

The environment is more challenging than expected, especially in France. However, thanks to the success of its new models and cost controls, the Group remains on track to achieve its full year guidance (provided that there is no further deterioration of the market conditions):

• higher Group registrations worldwide,
• positive Automotive operating margin,
• positive Automotive operational free cash flow.

Renault consolidated first-half results

ADDITIONAL INFORMATION

The consolidated financial statements of the Renault group at June 30, 2013 were approved by the Board of Directors on July 25, 2013. The Group’s statutory auditors have conducted a limited review of these financial statements and their report will be issued shortly. The financial report, with a complete analysis of the financial results in the first half of 2013, is available at www.renault.com in the Finance section.

[1] The restatements resulting from retrospective application of IFRS 11 “Joint Arrangements” and IAS 19 (revised) “Employee benefits” are presented in note 2-B.
[2] International: Americas, Asia-Pacific, Euromed-Africa and Eurasia.