Renault Shares Drop After Lower Third-Quarter Auto Sales By Investing.com

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© Reuters.

By Scott Kanowski

Investing.com — Stocks in Renault SA (EPA:) fell early in European trading on Friday after the French automaker said supply constraints weighed on the number of cars the French automaker sold in the third quarter.

Sales volumes fell 2.4% year-on-year to 481,000. The maker of brands like Dacia and Alpine reported that it was still facing disruptions in the supply of key semiconductors, which recently declined due to ongoing COVID-19 restrictions in parts of China, a major chip producer.

But that drop was partly offset by a slight rise in the price of Renault vehicles, which the firm said was necessary in response to cost and currency inflation. The group’s turnover increased by 20.5% to 9.8 billion euros.

The revenue result was also boosted by a weaker annual comparison. Renault has adjusted the figure recorded in the corresponding three-month period in 2021 to reflect the closure of its Russian operations following the outbreak of war in Ukraine.

The total financial impact of the disposal of these units amounted to 867 million euros, the company said.

Meanwhile, Renault confirmed its financial guidance for 2022, saying it expects to post an operating margin above 5% for the full year and automotive free cash flow from operations above 1.5 billion euros.

“The growth of the activity in the third quarter continues to reflect our commercial policy centered on value, put in place for 2 years now: improvement of the pricing policy, optimization of commercial discounts and priority to the most profitable channels”, declared the financial director. Thierry Piéton in a press release.

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