Paris (Reuters) -On Friday, the French car company Renault (EPA:RENA) said that its plan to turn things around and make them more profitable was working faster than expected.
At 7:45 GMT, Renault shares were up almost 6% after the company said that its operating margins for the first half of this year were 4.7%, compared to 2.1% for the same time last year. It raised its predictions for margins for the whole year to more than 5%.
This news made up for the fact that Renault had to close its Russian businesses because of the Ukraine war, which led to a net loss of 1.39 billion euros ($1.357 billion) in the first half for the French company.
Luca de Meo said that the fact that Renault’s margins are getting better shows that the turnaround plan he started when he took over in 2020, which was based on making more money than selling more cars, is working.
He said that the company is moving out of the emergency phase of the plan and into the rebuilding phase.
“After two years of sacrifices and a strict diet, we are now ready for the next chapter at Renault,” he told analysts on a call after announcing the first-half results.
De Meo said that the company was three years ahead of schedule in reaching the plan’s goals, even though getting the microchips used in everything from brake sensors to entertainment systems is hard for the whole industry.
The CEO said that discounts on Renault cars are at their lowest level in ten years, and that higher-priced new models like the Arkana compact SUV have helped the company make more money.
Renault made more money in the first half of this year than it had in the previous 10 years.
($1 = 0.9787 euros)
