Fiat still in red, eyes year-end profit

MILAN: Fiat remained in the red in the second quarter of 2009 but still expects to finish the year in profit, the Italian auto giant said Wednesday.

The group had a net loss of 179 mn euros (254 million dollars) in the period, compared with a profit of 646 million euros a year earlier, the company said in a statement.

The loss was greater than the 110 million euros expected by Dow Jones Newswires in a consensus forecast.

Hard hit by the global financial crisis like the rest of the auto sector, Fiat went into the red in the first quarter, recording a loss of 411 million euros in what it called an "extremely difficult trading environment."

It was the first loss since the group returned to profitability in early 2005 after four years of red ink.

Trading profit, Fiat's key profitability indicator, fell 72.5 percent in the second quarter to 310 million euros, while turnover fell back 22.5 percent to 13.18 billion euros.

"Aggressive cost containment measures and rigorous management of the group's operating leverage limited the impact of the significant drop in demand," the company said.

Fiat still expects to achieve a trading profit greater than one billion euros over the year, and a net profit greater than 100 million euros, the company said.