Seat posts a profit for the first time since 2008

3:32 pm, March 16, 2016

SEAT closed 2015 with a profit after-tax of six million euros, compared to a 66 million euro loss in 2014.

Growth in sales and a strong product mix with a higher contribution margin were the two main driving forces behind the change, according to the carmaker.

Seat posted a turnover of 8.3 billion euros, 11 per cent more than the previous year. This was the company’s best ever result and double the revenue in 2009, with average earnings per vehicle increasing by 3.5 per cent.

During the presentation of the 2015 annual results Luca de Meo, president of the Seat executive committee, said: ‘Seat’s progress in 2015 was twofold – not only did we obtain a positive result for the first time since 2008, but we achieved it during a year of major challenges. We are implementing the right strategy that enables us to face the challenge of sustaining long-term profitability with optimism. We have a brilliant future ahead of us thanks to the launch of new products and the integration of new technologies in both the field of mobility as well as connectivity.

‘The growth in sales for the third year in a row, exceeding the 400,000 vehicle barrier in a single year, was the result of recuperation in southern European markets such as Spain and Italy, the fifth consecutive year of growth in Germany, Seat’s main market, and the brand’s success in Mexico.’

The sustained level of sales of the Leon and the Ibiza, with 2015 deliveries totalling 160,900 (an increase of 4.4 per cent) and 153,600 (a rise of 2.4 per cent) units respectively, the strong increase of the Alhambra at 17.2 per cent and the success of the Audi Q3 – built by Seat – were beneficial to the volume as well as to Seat’s revenue, which grew for the sixth year in a row.

With its robust business performance, Seat was able to respond to the increase of spendings on advertising and marketing. In 2015, Seat spent 586 million euros on investments and R&D, 28 per cent more than the previous year.

Overall, the operating result improved by 96 per cent and stood at -7 million euros compared to the -167 million of a year ago.

Seat also increased its ability to generate profit through its core activity. The company improved its EBIDTA (earnings before interest, taxes, depreciation and amortisation) by 30 per cent, reaching 391 million euros, and increased operating cash flow by almost 50 per cent to 781 million euros.

The company’s vice-president for finance, IT and organisation Holger Kintscher added: “Seat continues to improve its capacity to generate its own resources to self-finance investments and consolidate the company from a financial standpoint. After several years of improvement, last year was a true milestone on the road to sustainable profitability.’

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