PSA Pegout SA (PEUGF) posted much better-than-expected full year earnings Thursday and said it would pay shareholders the first dividend in six years after a solid 2017 outlook.
The French carmaker, which is in advanced talks to buy the European operations of General Motors (GM) - Get General Motors Company (GM) Report , said net income rose 92% last year to €1.73 billion ($1.83 billion) while its operating income rose 18% to €3.24 billion. The group said it had a cash position of €6.8 billion as of Dec. 31 and would "deploy this cash to make profitable investments ... in the interest of our shareholders," according to the company. Part of that will go to paying a €0.48 per share dividend.
"These results demonstrate our ability to consistently deliver an excellent performance in an adverse environment," said chairman Carlos Tavares. "They are the outcome of the Group's operating efficiency improvement and our competitive teams' focus on the execution of the 'Push to Pass' plan."
Peugeot also said it expected its operating margin to average 4.5% in the 2016 to 2018 period after better sales and pricing dynamics lifted it 100 basis points to 6% last year.
Peugeot shares slipped around 1% in early trading in Paris to change hands at €18.56 each as investors took profits following a three month gain of around 30%, an advance that nearly trebled that of the Stoxx Europe 600 Automobiles & Parts index over the same period.