Stellantis confirms target and dividend. Tavares: 'Duties? With China we have to attack'

Stellantis, on the occasion of its first Investor Day, which will take place today, 13 June at 2pm Italian time in Auburn Hills, US, confirms its 2024 financial targets and return on capital plan, which include a double-digit Adjusted Operating Income ('AOI') margin and positive industrial free cash flow.

With regard to return on capital, a distribution of at least EUR 7.7 billion in dividends and share buybacks is expected in 2024, according to the group in a note. Cfo Natalie Knight will reiterate some more specific indications in terms of expectations for the first and second half of 2024: an expected AOI margin of 10-11% for the first half of the year, with industrial free cash flow significantly lower than in the same period last year; the launch of new models, actions on costs and the expected improvement in working capital support the opportunity for an improvement in AOI margin and industrial free cash flow in the second half of the year.

Stellantis 'is also updating its capital plan in several significant ways by setting liquidity levels with a target of 25-30% of revenues for the medium term, shifting the focus to capital efficiency and sustaining strong returns to shareholders. The Company will use share buybacks and ordinary dividends to remunerate shareholders' capital. In 2025, Stellantis will aim for the upper end of the 25-30% range in its dividend policy, compared to 25% in recent years,' it further reads.

"Our attitude and thinking has not changed from what has been said over the past two years. We are vigorously implementing the Dare Forward 2030 strategic plan, while achieving significant results." Carlos Tavares, CEO of Stellantis, said this while speaking at Investor Day. "We have confirmed the 2024 guidance while delivering solid returns for shareholders. Cash generation and a strong balance sheet have enabled us to continue to generate solid returns on capital on an ongoing basis. We are on track to pay out a total of EUR 7.7 billion in dividends and share buybacks in 2024," he said.

Regarding relations with China and the topic of duties, Tavares said that 'China is becoming an important part of business and this has an impact on the market. We are talking about duties, but one thing is clear: we do not want to be defensive, we have to go on the attack and ride the wave of the Chinese offensive'. According to the manager, 'China is assuming an increasing role globally and this must be taken into account in strategic decisions. Cost and speed are imperative,' he emphasised.