Fiat Chrysler q4 fy 2013 results

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Fiat Chrysler q4 fy 2013 results

  1. 1. Q4 & FY 2013 Results Review January 29, 2014 20 Novembre, 2010
  2. 2. Safe Harbor Statement Certain information including, without included limitation, in this any presentation, forecasts to realize benefits and synergies from our global included alliance among the Group’s members; substantial debt herein, is forward looking and is subject to important and limits on liquidity that may limit our ability to risks and uncertainties that could cause actual results execute the Group’s combined business plans; political to differ materially. and The Group’s businesses include civil unrest; earthquakes or other natural its automotive, automotive-related and other sectors, disasters and other risks and uncertainties. Any of the and it assumptions underlying this presentation or any of the affecting circumstances or data mentioned in this presentation its outlook considers these to is be predominantly the businesses. key based economic on factors Forward-looking what statements with may change. regard to the Group's businesses involve a number of contained important change, date interrelated duty factors including, but not that are subject limited to: the many to of to in this this statements. demand for disclaims products and could reduce products; automotive in relative governmental and automotive-related consumer demand programs; preferences for the general that Group’s economic Fiat any inaccuracies forward-looking presentation presentation. provide factors that affect consumer confidence and worldwide changes Any updates does any any assume in only expressly to not liability in speak We statements as these the a forward-looking and connection of of disclaim expressly with any forward-looking statements or in connection with any use by any third party of such forward-looking statements. This conditions in each of the Group's markets; legislation, presentation does not represent investment advice or particularly that relating to automotive-related issues, a recommendation for the purchase or sale of financial the products environment, trade and commerce and and/or any kind investment solicitation in Italy, pursuant to Section 1, production difficulties, including capacity and supply letter (t) of Legislative Decree no. 58 of February 24, constraints, excess inventory levels, and the impact of 1998, vehicle defects and/or product recalls; labor relations; solicitation as contemplated by the laws in any other interest rates and currency exchange rates; our ability country or state. Q4 & FY 2013 Results Review nor does it not services. the various industries in which the Group competes; amended, does financial Finally, January 29, 2014 presentation of infrastructure development; actions of competitors in as this of represent represent a an similar 2
  3. 3. The creation of global carco The last key milestone TRANSACTION SUMMARY (PURCHASE OF VEBA’S 41.5% EQUITY INTEREST IN CHRYSLER) • • Transaction closed on Jan 21, 2014 Fiat acquired VEBA’s 41.5% equity interest in Chrysler for aggregate consideration of $3.65bn, funded through:   Remaining consideration of $1.75bn paid by Fiat  • One-time special distribution from Chrysler to VEBA of $1.9bn Both above considerations funded from available cash Separately, Chrysler entered into an MoU with UAW to supplement existing collective bargaining agreement  Four equal annual payments by Chrysler to VEBA Trust totalling $0.7bn over next three years ($175mn made at closing, $175mn on each of following three anniversaries)  Commitments from UAW to support Chrysler’s industrial ops TRANSACTION BENEFITS TO FIAT • Acquisition of remaining 41.5% of Chrysler at reasonable levels • Eliminates headwinds to seamless integration of Fiat–Chrysler global alliance • • Parties agreed to dismiss litigation proceedings in Delaware Chancery Court Effective and efficient access to capital markets • • Full optimization of global product platforms, R&D, manufacturing footprint and sales & marketing efforts Not envisioned that Fiat will require equity capital to be raised via a rights issue January 29, 2014 Q4 & FY 2013 Results Review 3
  4. 4. Fiat re-organization Summary of proposed transaction FIAT S.P.A. Transaction Structure Voting Mechanism Listing Withdrawal Rights Process Timeline January 29, 2014 • • • • REORGANIZES AFTER COMPLETION OF PURCHASE OF CHRYSLER GROUP LLC Statutory reverse merger of Fiat S.p.A. into a wholly owned Dutch NewCo to be renamed Fiat Chrysler Automobiles N.V. (upon closing of merger, N.V. will issue common shares with 1:1 exchange ratio) NewCo expected to be resident for tax purposes in UK Loyalty voting structure to promote core base of long-term shareholders Shareholders who vote at Fiat EGM and continue to hold shares until closing may elect for an additional special voting share holding an immaterial economic entitlement   Shareholders may retain special voting shares until they transfer their common shares After closing, new shareholders with single vote shares may earn special voting shares by holding their common shares for three years • Shares listed in NY (with additional listing on Milan Stock Exchange) • Transaction to trigger withdrawal rights for Fiat S.p.A. shareholders (abstaining, dissenting or absent) •  Cash-out option at a price equal to 6 months average price prior to publication of notice of call of Fiat EGM Fiat S.p.A. creditors objection (60-day period after Fiat EGM) • • • EGM approval • Company targeting to execute transaction by year-end 2014 Withdrawal rights and creditors opposition period Closing subject to certain conditions, included a €500mn cap to cash-out resulting from exercise of withdrawal rights and creditors’ opposition Q4 & FY 2013 Results Review 4
  5. 5. New corporate identity January 29, 2014 Q4 & FY 2013 Results Review 5
  6. 6. FY 2013 Executive summary • • Worldwide shipments up 3% over prior year to 4.4mn units  Growth in NAFTA & APAC more than offsetting moderate contractions in LATAM and EMEA Key financial metrics       Italy 7% EMEA 19% Revenues at €87bn Others 1% Trading profit at €3.4bn Components 7% EBIT at €3.0bn Net profit at €2.0bn (€0.9bn excl. unusuals) Luxury brands 4% Net industrial debt at €6.6bn Total available liquidity at €22.7bn • • Jeep set all-time global sales record of 732k vehicles • NAFTA 53% APAC 5% Successfully active in capital markets • • (1) LATAM 11% WCM program’s “Gold” level awarded to Pomigliano d’Arco, Tychy and Bursa plants    Fiat bond issuances totaling ~€2.9bn and repayment of a €1bn bond at maturity Fiat renewed its 3-year €2.0bn RCF, subsequently increased to €2.1bn NAFTA 65% Chrysler re-priced twice its $3.0bn term loan and $1.3bn undrawn credit facility (aggregate savings of ~$70mn per annum) LATAM 18% New or extended partnerships in car financing  New private-label financing arrangement in U.S. with Santander, extended partnership in Europe with Crédit Agricole, renewed agreement in Brazil with Itaú Unibanco Guidance for 2014     Components 6% Revenues of ~€93bn APAC 11% Trading profit in €3.6-4.0bn range Break-even Net profit of ~€0.6-0.8bn Net industrial debt in €9.8-10.3bn range1 Includes cash outflows for Jan 21, 2014 closing of purchase of remaining 41.5% minority stake in Chrysler from VEBA (€2.7bn) and €0.3bn due to adoption of IFRS 11 January 29, 2014 Q4 & FY 2013 Results Review EMEA mass-markets brand Luxury brands Other and Eliminations ~(€0.5)bn ~ €0.5bn ~(€0.1)bn 6
  7. 7. FY 2013 financial highlights Net revenues (€mn) 83,957 Net profit (€mn) 86,816 1,951 • Group revenues up 3%  Increases in NAFTA and APAC partly offset by reductions in LATAM and EMEA  Strong top-line growth for Luxury brands • Positive impact of €1.5bn from recognition of net deferred tax assets related to Chrysler partly offset by €0.5bn in net unusual charges 896  Normalized net profit of €943mn (€1,140mn for 2012)  Components in line with 2012 (+4% at constant exchange rates)  Excl. unusuals and positive deferred tax impact, net loss of €911mn (€787mn last year) for Fiat excl. Chrysler FY ‘12 FY ‘13 FY ‘12 (1) FY ‘13 Trading profit (€mn) Dec 31 ‘12 3,541 Dec 31 ‘13  Strong Q4 cash-flow generation of €1.4bn from Chrysler and €0.3bn from Fiat excl. Chrysler  NAFTA: €2,220mn (+4.8% margin)  APAC: €358mn (+7.7% margin) • Slight increase for the year including €0.2bn of equity investments  Excluding equity investments, cash-flow for the year positive by €0.1bn 3,394 • Mass-market brands  LATAM: €619mn (+6.2% margin) • Cost of income taxes of €557mn, net of recognition of deferred tax assets (€244mn for Fiat excl. Chrysler) Net industrial debt (€bn) • Group trading profit down 4%, or +€0.1bn vs. 2012 on a currency adjusted basis • Trading profit for 2013 reflected €0.3bn in higher R&D amortization • €904mn attributable to the owners of the parent 4.2% margin • Group Capex at €7.4bn, substantially in line with 2012, but 3% higher at constant exchange rates 3.9% margin  EMEA: -€470mn (-2.7% margin) • Luxury Brands: €535mn (+14.0% margin) FY ‘12 (1) 6.5 6.6 20.8 FY ‘13 22.7 • Components: €201mn (+2.5% margin) EBIT (€mn) • Mass-market brands  NAFTA: €2,290mn 3,404 2,972 2.9 3.0  LATAM: €492mn  APAC: €318mn 17.9 19.7  EMEA: -€520mn FY ‘12 (1) Restated for adoption of IAS 19 as amended (Trading Profit/EBIT reduced by €273mn; Net Profit reduced by €515mn) Note: Graphs not to scale (1) January 29, 2014 • A €1.9bn increase over Dec 2012, mainly reflecting positive contribution from financing activities throughout the year, net of €1.0bn in negative currency translation effects  In 2013, Fiat issued a total of €2.9bn in bonds and repaid €1.0bn at maturity  Fiat excl. Chrysler at €12.1bn (€11.1bn at 2012-end) • Luxury brands: €470mn • Components: €146mn Liquidity (€bn) FY ‘13 Dec 31 ‘12 Dec 31 ‘13  Chrysler at €10.6bn (€9.8bn at 2012-end) with a €0.6bn negative impact from currency translation Undrawn committed credit lines Cash & Mktable Securities Q4 & FY 2013 Results Review 7
  8. 8. FY 2013 financial highlights Performance by segment MASS-MARKET 84.0 86.8 • BRANDS Group revenues up 3% (+7% at constant FX rates)   NAFTA 3.1 4.6 LATAM 2.9 3.8 APAC EMEA Ferrari & Maserati FY 2012 MASS-MARKET 2,491  Components EBIT before unusuals • 2012: €(543)mn • 2013: €(325)mn 392 470 492 255 318 NAFTA (1) LATAM (737) APAC Other & Eliminations (520) EMEA 3,404 2,972 • Components Other & Fiat Group (1) Eliminations (1) 2012 restated for adoption of IAS 19 as amended (NAFTA: -€250mn; LATAM: - €7mn; Components: -€3mn; Eliminations and Adjustments: -€14mn. EMEA losses reduced by €1mn) Note: Graphs not to scale; Numbers may not add due to rounding Q4 & FY 2013 Results Review NAFTA -8% (-9% before unusuals)  (187) (224) (1) EBIT -13% (ex-unusuals down 4%)  165 146 (1) January 29, 2014 Components revenues in line with 2012 at €8.1bn (+4% at constant FX rate) Fiat Group EBIT before unusuals • 2012: €(131)mn • 2013: €(82)mn EBIT before unusuals • 2012: €392mn • 2013: €535mn Ferrari & Maserati Luxury brands up 31% (Ferrari +5%, Maserati more than doubling to €1.7bn on strength of new models) EBIT before unusuals • 2012: €3,648mn • 2013: €3,491mn EBIT before unusuals • 2012: €176mn • 2013: €206mn 1,025 EBIT before unusuals • 2012: €2,443mn • 2013: €2,219mn (2.5) (2.9) FY 2013 BRANDS EBIT before unusuals • 2012: €1,056mn • 2013: €619mn 2,290 8.0 8.1 EMEA down 2% mainly reflecting volume decline in H1  11.1 10.0 17.8 17.4 LATAM down 10% in nominal terms (+1% at constant FX rate)  43.5 45.8 NAFTA (+5% or 9% at constant FX rate) and APAC (+48%) up on the back of higher volumes LATAM -52% (-41% before unusuals)    APAC +25%  Components -12% (+17% before unusuals) EMEA reduced losses by €217mn Luxury Brands +20% (+36% before unusuals) 8
  9. 9. Breakdown of unusual items FY 2013 (€mn) Asset write-downs mainly related to rationalization of architectures associated with new product strategy Repositioning of Alfa Romeo brand (390) (175) Repositioning of Fiat brand (90) Maserati R&D due to change of platform for luxury SUV (65) Cast Iron business (60) Amendments to Chrysler’s U.S. & Canadian salaried defined benefit pension plans Voluntary safety recall and customer satisfaction action related to certain older Jeep products 166 (115) Write-off of Equity Recapture Agreement right considering purchase of remaining equity interest in Chrysler (56) Devaluation of Venezuelan bolivar (43) Other (81) TOTAL UNUSUAL ITEMS (519) of which cash-items January 29, 2014 ~(100) Q4 & FY 2013 Results Review 9
  10. 10. FY 2013 From trading profit to net result €mn (unless otherwise stated) Fiat Group FY ’13 Worldwide total shipments (Units ‘000) Fiat excl. Chrysler FY ‘12 (1) FY ‘13 FY ‘12 4,352 4,223 1,900 1,920 Net Revenues 86,816 83,957 35,593 35,566 Trading Profit 3,394 3.9% 3,541 4.2% 246 0.7% 338 1.0% 97 107 103 110 EBIT BEFORE UNUSUALS 3,491 3,648 349 448 Unusual items, net (519) (244) (537) (261) EBIT 2,972 3,404 (188) 187 EBITDA 7,546 7,538 2,113 2,304 (1,964) (1,885) (989) (817) 1,008 1,519 (1,177) (630) 943 (623) 736 (418) 1,951 896 (441) (1,048) 943 1,140 (911) (787) % of revenues Investment income, net Financial charges, net (2) Pre-tax result Taxes Net result Net result excl. unusuals (3) Note (1) Restated for adoption of IAS 19 as amended (Trading Profit/EBIT reduced by €273mn; Profit before Taxes reduced by €517mn and Net Profit reduced by €515mn ) (2) “Financial charges, net” includes a €31mn gain from the mark-to-market value of stock option-related equity swaps (€34mn gain in FY ‘12) (3) Excluding net unusual charges and one-off net deferred tax assets January 29, 2014 Q4 & FY 2013 Results Review 10
  11. 11. FY 2013 net industrial debt walk Change in Net Industrial Debt (104) €mn Cash Flow from operating activities, net of Capex +79 7,961 1,464 313 (2,226) 3 (7,433) (6,545) December 31, 2012 • • Industrial EBITDA (excl. unusuals) Financial Charges & Taxes 1 Change in Funds & Other Working capital Capex (183) Investments, Scope & Other (6,649) (3) Capital increase /Repos/ Dividends FX translation effect 2 December 31, 2013 Net cash position of €0.2bn for Chrysler at year-end Positive operating cash flow net of Capex in 2013, with €1.6bn cash absorption for Fiat excl. Chrysler more than compensated by cash generation from Chrysler   Capex for Fiat excl. Chrysler at €3.9bn (+20% vs. 2012 or 25% at constant exchange rates), €3.6bn for Chrysler vs. €4.3bn in 2012 Positive working capital contribution from both Fiat excl. Chrysler (€1.1bn vs. €0.6bn absorption in 2012) and Chrysler (€0.3bn vs. €1.3bn in 2012) Net of equity swap and IAS 19 as amended Opening balance on Jan 1, 2014 higher by €0.3bn due to adoption of IFRS 11 Numbers may not add due to rounding 1 2 January 29, 2014 Q4 & FY 2013 Results Review 11
  12. 12. Chrysler pension & OPEB status update (IFRS, €bn) OPEB FUNDED STATUS PENSION PLAN FUNDED STATUS Dec 31, 2012 Discount Rate Contributions Earnings on Plan Assets Interest, Service & Other Dec 31, 2013 Dec 31, 2012 Discount Rate 0.2 1.2 2.0 Benefit Payments Interest, Service & Other Dec 31, 2013 (0.1) (2.0) 0.2 (2.3) 0.5 (1.0) (4.0) (6.7) WORLDWIDE WEIGHTED AVG. ASSUMPTIONS 2013 2012 WORLDWIDE WEIGHTED AVG. ASSUMPTIONS 2013 2012 Benefit Obligations at December 31: - Discount Rate – Ongoing Benefits 4.69% 3.98% Benefit Obligations at December 31: - Discount Rate – Ongoing Benefits 4.87% 4.07% • Pension and OPEB underfunded status reduced by €3bn primarily due to a higher discount rate, return on plan assets and pension contributions during the year • A ±100 basis point change in discount rate would impact pension obligations by ~€2.3bn Note: 2012 restated for adoption of IAS 19 as amended January 29, 2014 Q4 & FY 2013 Results Review 12
  13. 13. Chrysler refinancing transaction overview Sources & uses and pro-forma capitalization CASH SOURCES TO CHYSLER ($bn) • CASH USES FROM CHYSLER ($bn) Add-on to existing Term Loan B Refinance VEBA Trust Note 4.7 New Term Loan B Accrued Interest Chrysler Group LLC to refinance VEBA Trust Note in capital markets to enhance earnings and cashflow 0.3  Add-on to Secured Senior Notes TOTAL SOURCES 5.0 TOTAL USES 5.0  Note: Excludes estimated fees and expenses FIAT GROUP (€bn) Cash & Mktable Securities Actual Dec 31, 2013 19.7 Post Fiat-VEBA transaction Post refinancing Pro-forma Dec 31, 2013 • 16.9 16.9   (1)(2) Derivatives Assets / (Liabilities) 0.4 0.4 0.4 Total Cash Maturities (Principal) (28.7) (28.7) (28.7) (8.8) (8.8) (10.2) (14.2) (14.2) (16.2) VEBA Trust Note (3.4) (3.4) - Other Debt (2.3) (2.3) (2.3) Asset backed financing, accruals and other adj. (1.2) (1.2) (1.2) (NET DEBT) / NET CASH (9.8) (12.6) (12.6) (1) Industrial Activities (6.6) (9.5) (9.5) (2) Financial Services (3.1) (3.1) (3.1) Bank Debt Capital Market No penalty for early repayment Key benefits of transaction Pro-forma Dec 31, 2013 (1)(2) Reimbursement of principal amount and accrued interest, both tax deductible • Positive impact on earnings with pre-tax interest expense benefit of ~$130mm per year Improving projected cash flow by ~$2.5bn over next three years on the back of tax shield benefit and reduced interest cost as well as termination of principal payments No incremental debt at Chrysler or Fiat level Transaction consistent with Fiat-Chrysler treasury integration path • Including consideration of $1.75bn paid by Fiat and $1.9bn special distribution paid by Chrysler to its members Including $175mm payment to VEBA Trust which represents first of four equal annual payments due to VEBA Trust through 2017 Numbers may not add due to rounding January 29, 2014 Q4 & FY 2013 Results Review 13
  14. 14. 1 MASS-MARKET BRANDS BY REGION 2 LUXURY BRANDS 3 COMPONENTS 4 BUSINESS ENVIRONMENT OVERVIEW 5 2014 GUIDANCE
  15. 15. Mass-market brands Highlights FINANCIAL PERFORMANCE • Strong industry trend throughout the year supportive of a robust level of sales for the Group, especially in U.S. and Canada • Revenues for full year up 5% (+9% in USD terms) on higher shipments • FY trading profit down 9% (-6% in USD terms)   Decrease reflecting content enhancements associated with new models and higher industrial costs to support volume growth as well increased R&D amortization partly offset by higher shipments & improved pricing Trading margin at 4.8% COMMERCIAL PERFORMANCE & HIGHLIGHTS • Shipments (k units) Revenues (€mn) EBIT (€mn) (1) (1) FY ‘12 2,115 45,777 43,521 (€mn) Trading Profit FY ‘13 2,238 TOTAL NAFTA (1) 2,220 2,491 2012 restated for adoption of IAS 19 as amended January 29, 2014    U.S.: 1,876k vehicles, up 7% vs. last year Canada: 269k vehicles, up 5% Mexico & other: 93k vehicles • FY vehicle sales up 8% to 2,147k vehicles, above the market in both U.S. (+9%) and Canada (+7%) • Best sales performers in U.S. & Canada combined 2,443 2,290 FY shipments up 6% vs. prior year, primarily reflecting increased Jeep (Grand Cherokee, Wrangler and Cherokee) and Ram 1500 pickup shipments •   Double-digit growth for both Ram (+21%) & Dodge (+12%) Jeep +3%: double-digit performance for all nameplates (no availability of any D-SUV model until late October, bold contribution to sales of all-new Cherokee in Q4) U.S. dealer inventory at 79 days supply as dealers build stock of newly-launched Jeep Cherokee Q4 & FY 2013 Results Review 15
  16. 16. Mass-market brands EBIT walk €bn • Volume increase of 123k vehicle shipments • Positive mix primarily reflecting higher retail volumes and lower fleet volumes • Positive net price partly driven by vehicle content enhancements on recent launches • Industrial costs impacted by content enhancements and higher depreciation & amortization, partly offset by purchasing savings • SG&A costs higher primarily due to increased advertising expense • Other primarily relates to negative FX translation impact (~80mn) 868 588 2,491 2,290 (1,456) FY 2012 (1) (1) Volume & Mix Net price Industrial costs (90) SG&A (111) Investments / FX / Other FY 2013 2012 restated for adoption of IAS 19 as amended January 29, 2014 Q4 & FY 2013 Results Review 16
  17. 17. Mass-market brands Market trends & business dynamics INDUSTRY VOLUME & OUTLOOK (MN UNITS) U.S. • 15.9  • 3.9 3.7 0.38 Q4 '12 Q4 '13 Q4 '13 FY '13 • (%) 13.0 13.2 11.4 10.9 Q1 Q2 Q3 Q4 2010 FY share 13.0% 9.2% January 29, 2014 2011 Q1 Q2 Q3 Q4 Q4 up 11% vs. prior year Strongest annual sales since 2007 Q1 Q2 Q3 2012 FY share FY share 14.3% 10.5% 14.2% 11.2% 14.6% 11.4% Q4 & FY 2013 Results Review Q4 share up 50 bps to 11.4% Q4 retail sales up 12% Fleet mix down 70 bps to 21.7% of total sales in Q4 FY ‘13 industry recording highest FY levels ever, up 4% vs. prior year Q4 industry up 6% FY ‘13 Group sales up 7% vs. prior year •   Q4 sales up 7% vs. prior year  Q4 2013 FY share December represented the 45th consecutive month of year-over-year sales gains FY ‘13 market share up 20 bps; retail sales up 14% and fleet mix down from 26% to 22%  • 8.8 Q4   CANADA • 10.8 FY ‘13 Group sales up 9% vs. prior year    QUARTERLY MARKET SHARE 12.9 Q4 industry up 6% (cars +3%; trucks +9%)  1.8 0.40 Q4 '12 FY '13 12.6 FY ‘13 industry up 7% vs. prior year (cars +4%; trucks +10%) #2 selling manufacturer in Canada in 2013; best FY sales since 2000 49 consecutive months of year-over-year sales growth FY ‘13 market share up 40 bps to 14.6% 17
  18. 18. Mass-market brands Highlights FINANCIAL PERFORMANCE • FY industry up 1.3% in the region with Argentina at historical peak and Brazilian market at 3.6mn units, similar to 2012 levels • FY revenues down 10% vs. prior year (+1% at constant exchange rates) • Trading profit for full year reduced by 41% in nominal terms (down 33% at constant FX rates)   TOTAL LATAM Shipments (k units) Revenues (€mn) Trading Profit (€mn) EBIT (€mn) January 29, 2014 FY ‘13 950 979 9,973 • 1,025 Total Group FY shipments down 3% to 950k  • Brazil: 785k shipments or down 7% (188k units in Q4, an 18% decline compared with exceptionally strong quarter in 2012, when Group reacted promptly to increased demand in Brazilian market driven by government incentives)   1,056 492 Trading margin at 6.2% COMMERCIAL PERFORMANCE & HIGHLIGHTS 11,062 619 Venezuela trading performance down mainly due to reduced volumes and negative mix as FX restrictions limited supply levels, while other LATAM markets improved  FY ‘12 Decrease mainly attributable to Brazilian ops due to input cost inflation, also on weakening of Real affecting prices of imported materials, unfavorable production mix and lower volumes, as well as initial start-up costs for Pernambuco plant Argentina: 111k (+32%) Other LATAM markets: 54k (+7%) Disciplined management of company & dealer inventory (stable at ~1 month-supply at year-end) Q4 & FY 2013 Results Review 18
  19. 19. Mass-market brands EBIT walk • €mn • 1,025 • 64 Negative volume, reflecting decline in shipments, and less favorable market mix Disciplined pricing behavior supported by new product initiatives, but unable to price for inflationary increases Industrial costs impacted by  Labor and input cost inflation also on weakening of Real affecting prices of imported materials (principally within region)  Less favorable production mix (Argentina vs. Brazil)  Start-up costs for Pernambuco plant (111) (257) (37) 492 (192) FY 2012 January 29, 2014 Volume & Mix Net price Industrial costs SG&A Investments FX / Other Q4 & FY 2013 Results Review • FY 2013 • Higher SG&A driven by new advertising campaigns in Brazil Other mainly relates to FX translation effect (€85mn) and unusual charges (devaluation of Venezuelan Bolivar of €43mn and asset impairment for €75mn due to streamlining of architectures and models associated with region’s refocused product strategy) 19
  20. 20. Mass-market brands Market trends & business dynamics REGIONAL OVERVIEW INDUSTRY VOLUME & OUTLOOK (TOTAL LATAM; MN UNITS) Brazil 5.9 • 1.2 • 1.5 0.5 4.7 1.5 0.5 1.0 Q4 '12 • FY '13 Passenger cars LCVs CARS   & LCVS; %) Group retained its leadership in Brazilian market for the 12th year with overall share of 21.5%, 270 bps ahead of nearest competitor Group products continued to perform well  QUARTERLY MARKET SHARE (PASSENGER FY share compares with exceptional performance in 2012  1.1 Q4 '13 FY industry down 1.5% (Q4: -3%) compared to 2012 which benefited from a period of higher sales tax incentives Combined 25% share of A/B segment, driven by continued success of new Palio and Uno Siena and Grand Siena posting a combined 25% year-over-year sales increase Strada up 5% boosted by contribution from refreshed models launched in Q4 Argentina 22.3 10.2 23.6 21.7 11.6 Q4 Q1 Q2 Q3 Q4 20.0 9.3 Q1 Q2 Q3 10.5 Q4 Q1 Q2 Q3 2010 2012 2013 FY share FY share FY share 23.0% 11.2% January 29, 2014 2011 FY share 22.2% 11.6% 23.3% 10.6% Q4 21.5% 12.0% Q4 & FY 2013 Results Review • • FY market up 14% to 919k units (Q4: +23%) Group FY sales up 31% to ~111k  Share up 140 bps facilitated by improved customs clearance for vehicle imports Update on IPI tax • Reduced IPI rates to gradually return to preincentive levels during 2014 with increases varying by engine displacement, fuel and vehicle type   A 1 to 2 p.p. increase occured on Jan 1 A further increase expected on Jul 1 (adding 2 to 5 p.p.) 20
  21. 21. Mass-market brands Market trends & business dynamics FINANCIAL PERFORMANCE • Strong overall demand in the region (+9%) driven by double-digit growth in China, partially offset by slowing demand in India • FY revenues up 48% • • TOTAL APAC FY ‘13 FY ‘12 Shipments 163 103 Revenues 4,621 358 260 318 255 (€mn) Trading Profit (€mn) EBIT (€mn) APAC industry reflects aggregate for key markets where Group competes (i.e. China, India, Australia, Japan, South Korea) January 29, 2014 Shipments up 58%, primarily driven by Jeep, Fiat and Dodge brands Trading profit for full year up 38% over 2012 levels  Increase primarily driven by higher volumes, partially offset by increased industrial, SG&A expenses in line with regional growth  Trading margin remained strong (7.7%) FY EBIT up 25%, with trading profit improvement partially offset by start-up costs incurred by Chinese joint venture COMMERCIAL PERFORMANCE & HIGHLIGHTS 3,128 (k units)  • Strong retail sales (incl. JVs) throughout the year, up 73% to 199k vehicles in the region   Fiat brand volumes ~5x last year’s level primarily driven by Fiat Viaggio in China  • Jeep (~50% of total Group sales in APAC) up 26% over prior year Successful return of Dodge Journey, now Group’s fourth best-selling vehicle in the region (after Fiat Viaggio, Jeep Compass and Jeep Grand Cherokee) Strong sales momentum continued in Q4, up 79% vs. a year ago to 62k vehicles with December the best-selling month in the region’s history Q4 & FY 2013 Results Review 21
  22. 22. Mass-market brands EBIT walk €mn • • (106) FY 2012 January 29, 2014 Increased SG&A expenses to support volume growth and continued regional expansion • Other primarily reflects higher losses of Chinese ops (€74mn) also including start-up costs for launch of Fiat Viaggio and Ottimo and unfavorable FX impact 318 (72) 255 Increased industrial costs due to higher R&D and fixed manufacturing costs from new product initiatives and higher production volumes • (79) Pricing impacted by increasingly competitive environment, particularly in China • 423 Volume/mix reflecting higher shipments (+60k units) and better mix (higher penetration of SUVs) (103) Volume & Mix Net price Industrial costs SG&A Investments / FX / Other Q4 & FY 2013 Results Review FY 2013 22
  23. 23. Mass-market brands Market trends & business dynamics INDUSTRY VOLUME1 (PASSENGER CARS & LCVS; MN UNITS) 26.1 REGIONAL OVERVIEW FY Group sales (incl. JVs) significantly outperforming industry (+9%) driven by strong performance in China and Australia 7.0 6.1 CHINA • Q4 '12 Q4 '13 FY '13  QUARTERLY MARKET SHARE  (PASSENGER CARS & LCVS; %) 3.4% 2.2% • 0.36% 0.54% Q4 Q1 0.49% 0.27% Q2 Q3 Q4 Q1 0.11% Q2 Q3 0.38% Q4 Q1 Q2 Q3 2010 2011 2012 FY share AUS IND CHI JAP FY share FY share FY share 1.2% 0.9% 0.2% 0.2% 1.6% 0.7% 0.3% 0.3% 2.1% 0.4% 0.4% 0.3% 3.1% 0.4% 0.8% 0.4% 2013 1.Reflects aggregate for key markets where Group is competing (i.e. China, India, Australia, Japan, South Korea) January 29, 2014 FY share up 100 bps over 2012 Jeep +31% vs. prior year; Fiat, Alfa Romeo and LCVs at 4x last year’s level supported by consolidation of sales & distribution activities into one Group company INDIA 0.38% 0.21% Fiat Viaggio, Jeep Compass and Dodge Journey as topsellers Group sales up 53%, significantly outperforming a moderately growing market (up 2%) in 2013   0.91% 0.55% 0.28% 0.31% Share gain of 40 bps driven by Fiat Viaggio, Dodge Journey and continued growth of Jeep brand AUSTRALIA 1.7% 1.4% FY Group sales up 125% posting the best sales improvement in an industry growing 17% Q4 • Sales up 41% over same period in 2012 on the back of establishment of new distribution network JAPAN • FY Group sales up 6%, outperforming a largely flat industry (gains driven by Chrysler, Abarth & Fiat) SOUTH KOREA • Sales up 16% for the year in a market down 1% Q4 & FY 2013 Results Review 23
  24. 24. Mass-market brands Highlights FINANCIAL PERFORMANCE • Although mixed across major markets, overall trading conditions in EU27+EFTA remained weak throughout 2013 with initial signs of stabilization in H2   • • FY 2013 being the 6th consecutive year of decline  LCVs: FY industry flat vs. prior year FY revenues slightly down due to lower shipments Trading loss for FY reduced by €233mn, or 33%   TOTAL EMEA Shipments (k units) Revenues (€mn) Trading Profit (€mn) EBIT (€mn) FY ‘13 FY ‘12 979 1,012 17,420 17,800 (470) (703) (520) Note 1 Harbour definition: 235 days p.a. / 16 hours per day 2 Technical definition: 280 days p.a. / 3 shifts per day January 29, 2014 • (737) Among major markets, the Q4 passenger car segment posted 2nd quarter of year-over-year gains, Italy still negative Sequential quarter-over-quarter improvement in 2013, with losses in Q4 reduced by 58% to €50mn Better mix and cost efficiencies more than offsetting headwinds still negative pricing FY EBIT loss reduced by ~30%   Results from investments of €145mn (€160mn in 2012) with decline also due to unfavorable FX impact of Turkish Lira Unusual charges flat at €195mn (2013 including write-off of previously capitalized R&D related to new model development for Alfa Romeo products) COMMERCIAL PERFORMANCE & HIGHLIGHTS • • Overall shipments down 3%, or 33k units   Passenger cars down 34k (-4%) to 776k units, with decline fully attributable to lower volumes in Italy LCV shipments substantially unchanged at 203k units Strict management of supply and demand function   Company & dealer inventories stable at ~2-months supply Utilization rate at plants in EMEA, including JVs, nearly stable (67% Harbor1 definition, or 42% Technical2 definition) Q4 & FY 2013 Results Review 24
  25. 25. Mass-market brands EBIT walk • Better mix (mainly 500 family & LCVs) partly offset by negative volume, reflecting decline in passenger car shipments • Price pressure continuing (more accentuated in H1) • Improvement in industrial costs driven by WCM program efficiencies & purchasing savings more than offsetting higher R&D amortization • Continued implementation of cost efficiencies in SG&A spending, mainly related to reduced advertising • €mn Other includes unfavorable FX and lower contribution from JVs (principally Tofas due to FX conversion) 199 (26) 139 (737) FY 2012 January 29, 2014 (520) 77 (172) Volume & Mix Net price Industrial costs SG&A Investments / FX / Other Q4 & FY 2013 Results Review FY 2013 25
  26. 26. Mass-market brands Passenger cars: market trends & business dynamics INDUSTRY VOLUME & OUTLOOK (MN UNITS) EU27+EFTA • EU27+EFTA  3.0 Q4 '13 0.3 Q4 '12 FY '13 Q4 '13 FY '13 QUARTERLY MARKET SHARE • • 29.3 28.4 6.9 6.3 FY share at 6.0% 6.2 Share performance in EU27+EFTA ex-Italy (3.3%) similar to prior year with share gains in France, UK & Spain offset by share losses in Germany and some other minor markets  27.7 Italian market weight further reduced, to 11% of total European industry, or 500 bps lower than pre-crisis levels in 2007 5.6 ITALY EU27+EFTA Q4 2010 Q1 Q2 Q3 2011 Q4 Q1 Q2 Q3 2012 Q4 Q1 Q2 Q3 Q4 2013 FY share FY share FY share FY share 30.3% 7.7% January 29, 2014 FY Group sales down 7% to 736k  (%) 28.8 Among major countries, positive comps for UK (+11%) & Spain (+3%); negative performance in Germany (-4%), France (-6%) with Italy suffering the most (-7%) 1.3 0.3 Q4 '12 Positive year-over-year performance in H2 (+4%) unable to counter downwards trend in H1 (-7%)  12.3 2.8 FY industry down 1.8% to 12.3mn units 29.4% 6.9% 29.6% 6.3% 28.7% 6.0% Q4 & FY 2013 Results Review • Industry troughed at lowest levels since 1978, with decline moderating in H2 (Q4: -3%)  Share down 90 bps as a combined result of Group’s repositioning strategy and decision not to engage further in value destructive price competition, particularly in H2 26
  27. 27. Mass-market brands LCVs: market trends & business dynamics INDUSTRY VOLUME & OUTLOOK (MN UNITS) 1.57 EU27+EFTA • 0.41 0.38 0.03 Q4 '12 Q4 '13 Q4 '13  0.10 Q4 '12 FY '13 0.03 FY '13 (%) 42.4 41.9 10.8 46.0 42.7 11.9 10.8 FY Group sales at 182k units, flat over prior year • Fiat Professional FY share stable, with a 9.4% record share in EU27+EFTA excl. Italy offsetting unfavorable market mix  10.4  EU27+EFTA Q4 2010 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Mixed trend among major markets: for fullyear, Italy -15% (Q4: -2%), France -5% (Q4: +3%), Germany -2% (Q4: +6%), but with double-digit growth in UK (+12%) & Spain (+11%), up 26% and 34% in Q4, respectively • QUARTERLY MARKET SHARE* Q2 Q3 2011 2012 FY share 44.0% 12.7% 44.4% 12.5% FY share 44.0% 11.6%  FY share 42.7% 11.7% Q4 2013 FY share * Due to unavailability of official data for the LCV market since Jan 2011, figures reported beyond that date are an extrapolation. Therefore, marginal discrepancies versus actual data may exist January 29, 2014 FY market flat at 2012 levels, after a bad start (Q1: -10%), then gradually improving with Q4 being the first positive year-over-year industry gain (+9%) Q4 & FY 2013 Results Review • Share gains in Italy (+130 bps), UK (+140 bps) and Spain (+40 bps), while flat in Germany & France Unfavorable market mix penalized market share in Q4 in EU27+EFTA, notwithstanding a strong performance in Italy (+330 bps) Ducato topped 100k units sold in European market, recording 80 bps share gain in its segment Outside Europe, strong share performance in Russia (+230 bps) 27
  28. 28. Luxury brands 2 Ferrari & Maserati • FY revenue up 5% to €2.3bn  • FY revenue 2.2x last year’s level to €1.7bn Shipments of street cars down 5% to 6,922 units, consistent with strategic target to maintain production below prior year’s level to preserve brand’s exclusivity  FY shipments of 15.4k units, up 148% vs. 2012 driven by success of new Quattroporte and Ghibli launched in 2013  Shipments of ~8k for Quattroporte, ~3k for Ghibli with order intake totalling 13k units apiece at Dec-end 12-cyl models up 19% on the back of F12 Berlinetta released just 1 year ago; 8-cyl down 12%  GranCabrio & GranTurismo in line with 2012 (5k units) USA: ~7k units (+138%), brand’s #1 market  North America (+9%) remained #1 market  Europe: UK in line with 2012, other major markets down   China: 4.3x last year’s volumes to ~4k units, the brand’s second market  China, Hong Kong & Taiwan declined, partially offset by increases in Japan  Europe: up 133% to ~3k units  Mid-East up 81% and APAC-ex China up 52% to ~2k units in aggregate  First 20 units of special edition “LaFerrari” shipped  • FY trading profit up 9% to €364mn  Improvement reflecting better sales mix and contribution from licensing and personalization program  Margin up 50 bps to 15.6% USA 30% European Top-5 35% • FY trading profit at €171mn, €114mn higher than a year ago, representing a 10.3% margin  Q4 at €123mn (€13mn in 2012) or 15.9% margin European Top-4 13% USA 45% Japan 4% Japan 5.5% Others 22% January 29, 2014 China, Hong Kong & Taiwan 8% China 25% Others 13% Q4 & FY 2013 Results Review 28
  29. 29. Components 3 • Operational Highlights 5,828 • Solid performance in 5,988 141 166 NAFTA and China with modest gain in Europe; Brazil stable at constant exchange rates 780 FY ‘12 FY ‘13 FY ‘12  0 (13) Cast Iron business unit posted a 7% decrease in volumes in Europe and the Americas with lower demand in all segments, particularly light vehicles Aluminum business posted 13% increase in volumes FY ‘12 FY ‘13 Trading performance primarily attributable to volume declines Revenues substantially in line with prior year • FY ‘13 • • FY ‘12 FY ‘13  688 • Order intake up 44% to €2.6bn Revenues down 12% A €15mn increase in trading profit primarily driven by Body Welding ops • Order intake for System activities up 18% to €1.5bn Note: graphs not to scale Note: graphs not to scale • FY revenues up 3% to €6bn (+6% at constant exchange rates)     • Lighting up 12% on the back of performance in China as well as NAFTA where several new products launched in H2 2012 Electronic Systems up 7% primarily due to growth in sales of “telematics and body” products Powertrain business flat at constant exchange rates After market business up 5% (+13% at constant FX rates) with growth in Europe and Mercosur only partially offset by decrease in NAFTA Trading profit up 18%, a 40 bps margin increase to 2.8%  1,482 1,463 33 FY ‘12 FY ‘13 Top-line growth only partially offset by higher industrial costs associated with new product launches in NAFTA January 29, 2014 Q4 & FY 2013 Results Review 48 FY ‘12 FY ‘13 Note: graphs not to scale 29
  30. 30. 4 Business environment overview January 29, 2014 Q4 & FY 2013 Results Review 30
  31. 31. Business environment overview Jeep Cherokee starts strong; All-new Chrysler 200 revealed All-New 2015 Chrysler 200 All-New Cherokee (Launched end of October 2013) 17 Worldwide sales (000’s) 11 • • • 1 Oct Nov Dec • Over 29k sold worldwide (mostly NAFTA) in just over 2 full months on sale • Presented at 2014 Detroit Auto Show • Benchmark features in its category Available in H1 2014 Derived from common Compact U.S. Wide architecture  First mid-size sedan with a standard 9-speed automatic transmission Strong market reception supporting 64k shipments since shipment hold released in late October   Expected fuel economy rating of 35 MPG highway • Competes in largest SUV segment in NAFTA (~2.0mn vehicles)  • Two world-class engines (Pentastar V-6 with best-in-class 295hp) & 2.4L MultAir®2 Tigershark (I-4 engine, 184hp) First mid-size SUV with a 9-speed automatic transmission • Best-in-class capability with new Trailhawk model January 29, 2014 • Available all-wheel-drive system with automatic fully disconnecting rear axle Production at Sterling Heights assembly plant in Michigan  More than $1bn investment (product and plant), including all-new paint shop and fully robotic body shop Q4 & FY 2013 Results Review 31
  32. 32. Business environment overview Strengthening product line-up, preparing for upscale move KEY LAUNCHES IN NEW STRADA • STATUS Best-selling nameplate in its segment  • Q4 UPDATE OF NEW PLANT LOCATED IN GOIANA (STATE OF PERNAMBUCO) NORTHEAST BRAZIL 50% segment share in Brazil for FY 2013 Launched two refreshed models   Single-cab Strada launched in market in October Ramp-up of production for double-cab version started in October • Investment for new complex started in Q4 2012 • • Expanding Uno family Significant improvements compared to prior model   Increased cargo capacity New and more fuelefficient engines January 29, 2014 • Capex spanning through 2016 (~€2bn in 2012-14 period) with Fiat to receive financing for up to 80% of total investment  ALL-NEW FIORINO  In addition, once production begins, project will also benefit from tax incentives for a period of 5 years Start-of-production expected in H1 2015   • Initial annual capacity of 200k vehicles for domestic market and export Small-Wide architecture to strengthen mid-size car offerings Expandable, flexible world-class production site     Integrated international supplier park Product engineering and testing facilities Over 80% of components localized Favorable logistics infrastructure (port, railway…) Q4 & FY 2013 Results Review 32
  33. 33. Business environment overview Significant sales up for Fiat brand in China APAC SALES GROWTH BY BRAND Vehicles (000s) 20 16 8 FIAT BRAND IN CHINA 199 • Fiat Viaggio  Group best-selling vehicle in APAC in 2013 41  Positive market acceptance driven by design and equipment levels 115  Viaggio One-year Anniversary Special Edition and Shining Edition debuted at Chengdu Auto Show and Guangzhou Auto Show, respectively • FY SALES +73% Fiat Ottimo  Hatchback version of Fiat Viaggio, to roll out to Chinese dealerships in early 2014 •  Second Fiat vehicle FY ‘13 FY ‘12 locally produced in China Fiat brand sales up 160%, accounting for 44% of total sales increase  Global premiere at Guangzhou Auto Show in November  7-speed dual-clutch transmission powered by 1.4T-JET  Fiat Viaggio continuing to gain momentum • • Strong performance of Jeep brand with 17 consecutive quarters of year-over-year growth Dodge brand sales boosted by re-introduced Journey January xx, 2014 engine • Fiat dealership network continued to expand, nearly doubling to 200+ points of sale in 2013, covering a total of 126 cities across China Q4 & FY 2013 Results Review 33
  34. 34. Business environment overview Moving on & up RE-FOCUS • FIAT TRADING PERFORMANCE BRAND (€MN) Structural shift of brand towards upper layer of core segments      • AND REALIGNMENT OF 2012 Expanded 500 family with 500L, Trekking & Living variants, adding to iconic hatchback model (1+mn units sold in Europe since launch in 2007) Q1 Q2 2013 Q3 Q4 FY 500 family now representing 33% of brand sales (20% in 2012) Segment leadership in FY 2013 for 500 (A-Segment, first-time since launch) and 500L (Compact-MPV) in EU27+EFTA (157) (207) 3 out of 4 Fiat 500s sold outside Italy (138) 29% Launch of 500X model in H2 2014 24% (50) (98) (165) (238) (120) 58% 31% Select utility vehicles to round out brand offerings, with Panda second best-selling vehicle in A-segment (470) (703) 33% improvement Sustained improvement driven by: • • • Enhancement of industrial cost efficiencies • January 29, 2014 More favorable mix driven by product portfolio repositioning strategy Continued tight grip on G&A costs Q4 & FY 2013 Results Review Optimization of advertising spending by rechannelling resources to 500 family while reducing overall spending 34
  35. 35. Business environment overview 4 Market outlook (mn units) NAFTA APAC LATAM 5.9 4.6 FY '13 EU27+EFTA 1.3 4.7 >16 5.9 1.2 15.9 EMEA FY '14E 26.1 ~27.0 1.6 FY '13 FY '14E Passenger cars 1.8 1.5 12.3 FY '13 LCVs FY '13 FY '14E ~1.8 12.4 FY '14E Passenger cars LCVs ~0.1 0.12 FY '13 FY '14E Upwards trend for U.S. industry projected for 2014, but at lower rate than prior years  Both car and truck segments expected to increase • Canada market in 2014 expected to be substantially in line with record levels reached in 2013 LATAM market in 2014 expected to perform in line with prior year • 2013 Canada market was the highest ever • • • Brazilian industry to grow ~3% underpinned by a projected GDP growth in line with prior year Argentina industry to decline double-digit due to import restrictions and higher sales tax on high-end segments • Industry demand projected up ~4% driven by strong growth in China, India, South Korea and Australia, offset by contraction in Japan Group targeting to increase 40% in 2014 retail sales (incl. JVs)  Performance of Fiat, Jeep and Dodge brands to play key role in Group expansion activities ~1.4 FY '12 • 1.4 FY '13E Overall industry (passenger car & LCV segments in aggregate) projected stable • • Passenger cars  Slight growth in EU27+EFTA (+0.5%) vs. prior year  Italy +3%; Germany +4% LCVs   Mid-single digit contraction in EU27+EFTA Italy to perform in line with passenger car segment Note: APAC reflects aggregate for key markets where Group competes (i.e. China, India, Australia, Japan, South Korea) January 29, 2014 Q4 & FY 2013 Results Review 35
  36. 36. 4 Business environment overview Group shipments (excl. JVs) (units in thousands) (units in millions) 4,223 Luxury +150% APAC +85% 4 26 +8% 267 543 248 Q4 ‘12 EMEA -5% LATAM -3% 2,238 1,012 EMEA -3% Luxury >0.2 APAC 950 NAFTA +6% 0.05 163 22 0.9-1.0 LATAM ~2.4 NAFTA 979 ~1.0 EMEA FY ‘13 FY ‘14E 10 227 LATAM -15% NAFTA +20% 103 Luxury +57% APAC +58% 2,115 1,172 4.5-4.6 4,352 979 14 1,088 +3% 48 651 236 Q4 ‘13 FY ‘12 Note: Numbers may not add due to rounding; Graphs not to scale January 29, 2014 Q4 & FY 2013 Results Review 36
  37. 37. 5 2014 Guidance for the Group (€bn, except EPS) REVENUES NET INCOME 2.0 CHANGES RELATIVE TO 2013 1.5 ~93 0.2-0.6 87 0.9 0.6-0.8 (0.5-0.7) (0.5) 2013 2013 2014E Profit to the owners of the Parent Recognition of deferred tax assets Unusuals 2013 Normalized Net income Taxes (principally deferred) 2014E 0.9 0.1 0.5-0.7 0.74 EPS 0.10 0.44-0.60 TRADING PROFIT NET INDUSTRIAL DEBT Year-end 2013 (Pro-forma) Year-end 2013 Year-end 2014E CHANGES 3.4 Trading profit 3.6-4.0 RELATIVE TO 2013 (1) Industrial EBITDA: higher Financial charges: stable (6.6) Positive change in Working Capital: lower (2.7) 2013 2014E Capex: higher (0.3) (9.7) Purchase of Adoption of remaining 41.5% IFRS 11 minority stake in Chrysler from VEBA (1) Includes first payment of $175mn to VEBA Trust under MoU regarding industrial cooperation principles with UAW (9.8-10.3) Note: Numbers may not add due to rounding; Graphs not to scale January 29, 2014 Q4 & FY 2013 Results Review 37
  38. 38. APPENDIX
  39. 39. Supplemental financial measures Fiat Group monitors its operations through the use of various supplemental financial measures that may not be comparable to other similarly titled measures of other companies. Accordingly, investors and analysts should exercise appropriate caution in comparing these supplemental financial measures to similarly titled financial measures reported by other companies. Fiat Group management believes these supplemental financial measures provide comparable measures of its financial performance based on normalized operational factors, which then facilitate management’s ability to identify operational trends, as well as make decisions regarding future spending, resource allocations and other operational decisions. Fiat Group’s supplemental financial measures are defined as follows:  Trading Profit (Loss) is computed starting with Net Revenues less operating costs (cost of sales, SG&A, R&D costs, other operating income and expenses)  Earnings Before Interest, Taxes (“EBIT”) is computed starting from Trading profit (loss) and then adding restructuring costs, other income/expenses that are unusual in the ordinary course of business (such as gains and losses on the disposal of investments) and the Result from investments  Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) is computed starting with EBIT and then adding back depreciation and amortization expense  Net Industrial Debt is computed as debt plus other financial liabilities related to Industrial Activities less (i) cash and cash equivalents, (ii) current securities, (iii) current financial receivables from Group or jointly controlled financial services entities and (iv) other financial assets. Therefore, debt, cash and other financial assets/liabilities pertaining to Financial Services entities are excluded from the computation of Net Industrial Debt January 29, 2014 Q4 & FY 2013 Results Review 39
  40. 40. Chrysler Net income reconciliation (from IFRS to US GAAP) (1) Twelve Months ended December 31, 2013 EURO (mn) (895) 472 626 68 (201) (166) (218) (316) Other (3) (674) (150) Pension/OPEB adjustments 3,176 52 Reconciling Items: Capitalization of development costs, net of amortization (2) USD (mn) 2,392 Chrysler Net Income – IFRS (1) (419) 2,076 2,757 (2) (3) Unusual Items: Pension plan changes (4) Chrysler Net Income - US GAAP January 29, 2014 Q4 & FY 2013 Results Review (4) Including unusual items and restructuring Under IFRS, development costs for vehicle programs are capitalized as intangible assets if the development costs can be measured reliably and the economic feasibility of the product supports the view that the development expenditure will generate future economic benefits. Capitalized development costs include all direct and indirect costs that are directly attributable to the development process. These costs are subsequently amortized to expense on a straight-line basis from the start of production over the estimated production cycle. Under US GAAP, with the exception of certain software development costs, development costs are expensed as incurred in accordance with ASC 730, Research and Development Costs Under IFRS, net interest cost is calculated by multiplying the net defined benefit liability (asset) by the discount rate used at the start of the annual period to measure the defined benefit liability (asset). Under U.S. GAAP, entities recognize the interest cost on the present value of the defined benefit liability (asset), using the discount rate, and an expected return on plan assets (EROA), which is the expected long-term rate of return on the market value of assets. Since the EROA is generally higher than the discount rate used to determine interest cost on the defined benefit obligation, the overall cost reflected in the income statement is generally higher under IFRS as compared to U.S. GAAP Under U.S. GAAP, curtailment gain and plan amendments were a net reduction to pension obligation offset in accumulated other comprehensive income 40
  41. 41. Chrysler Net debt reconciliation (from IFRS to US GAAP) Dec 31, 2013 EURO (mn) USD (mn) Chrysler Net Debt - IFRS (215) (296) Unamortized purchase accounting adjustments (1) (424) (584) (218) 101 (541) (301) 138 (747) (756) (1,043) Classification and other differences: Accrued interest Other Net Industrial Debt - US GAAP (1) January 29, 2014 In connection with the May 24, 2011 transaction, all financial liabilities were re-measured to their fair value as of the date of consolidation. The unamortized balance primarily relates to the fair value adjustment on the VEBA Trust Note Q4 & FY 2013 Results Review 41
  42. 42. Financial charges breakdown FY 2013 FY 2012 Avg. Outstanding (€bn) Gross Industrial Debt Industrial Cash & Net Intersegment Financial Receivables (2) Net Industrial Debt (3) IAS 19 Avg. Outstanding (€bn) Rate (%) P&L (€mn) 7.0% (900) (12.0) 7.1% (849) (13.9) 6.6% (920) (13.7) 7.2% (990) (26.8) Other Financial Debt (1) P&L (€mn) (12.9) Capital Market Rate (%) 6.8% (1,820) (25.7) 7.2% (1,839) 19.4 0.8% 156 19.3 1.2% 230 (1,664) (6.4) (7.4) (1,609) (371) (388) Equity Swap 31 34 Others 40 78 (1,964) (1,885) (interest cost on pension & OPEB) (4) Net Financial Charges Note Include expense incurred in relation to sale of receivables, committed lines fees, hedges Net of charges on sales of receivables intersegment and floor plan fees Excluding derivatives fair values (4) Include FX gain/losses, interest cost capitalized (IAS23), bank fees and other financial charges Numbers may not add due to rounding (1) (2) (3) January 29, 2014 Q4 & FY 2013 Results Review 42
  43. 43. Detailed cash flow (€mn) Fiat Group Q4 2013 Fiat Group Q4 2012 (1) (8,307) (6,694) 1,296 224 1,227 1,028 (365) 407 2,158 1,659 1,672 590 3,830 2,249 (2,175) (2,254) 1,655 (5) (23) 122 1,632 117 (1) 2 27 30 1,658 149 (6,649)2 (6,545) FY 2013 Net Industrial (Debt)/Cash beginning of period Fiat ex cl. Chrysler FY 2012 (1) FY 2013 FY 2012 (1) (6,545) (5,529) (5,048) (2,449) Net Income 1,951 896 (441) (1,048) D&A 4,572 4,132 2,299 2,115 Change in Funds & Others (475) 617 (679) (36) 6,048 5,645 1,179 1,031 1,464 694 1,129 (581) 7,512 6,339 2,308 450 (7,433) (7,530) (3,860) (3,219) 79 (1,191) (1,552) (2,769) (183) 292 (308) 247 (104) (899) (1,860) (2,522) (3) (36) 3 (36) 3 (81) 41 (41) (104) (1,016) (1,816) (2,599) (6,649)2 (6,545) (6,864) (5,048) Cash Flow from Op. Activities bef. Chg. in W.C. Change in Working Capital Cash Flow from Operating Activities Tangible & Intangible Capex Cash Flow from Operating Activities net of Capex Change in Investments, Scope & Others Net Industrial Cash Flow Capital Increase / Share Repurchases / Dividends FX Translation Effect Change in Net Industrial Debt Net Industrial (Debt)/Cash end of period (1) Restated for adoption of IAS 19 as amended (2) Opening balance on Jan 1, 2014 higher by €0.3bn due to adoption of IFRS 11 Note: Numbers may not add due to rounding January 29, 2014 Q4 & FY 2013 Results Review 43
  44. 44. Fiat excl. Chrysler Net debt breakdown (€bn) Sept. 30, 2013 Dec. 31, 2013 Cons. Fin. 19.1 15.9 3.3 (0.3) (0.3) (8.6) 10.2 * Ind. Cons. Ind. Fin. Gross Debt* 20.3 17.0 3.4 - Derivatives M-to-M, Net (0.3) (0.3) - (8.4) (0.2) Cash & Mktable Securities (10.0) (9.8) (0.2) 7.1 3.1 Net Debt 10.0 6.9 3.1 Net of intersegment receivables Note: Numbers may not add due to rounding January 29, 2014 Q4 & FY 2013 Results Review 44
  45. 45. Fiat excl. Chrysler Gross debt (€bn) Outstanding Sept 30, ‘13 Outstanding Dec. 31, ‘13 18.4 5.8 11.4 1.2 Cash Maturities Bank Debt Capital Market Other Debt 19.3 6.2 11.9 1.2 0.4 Asset-backed financing 0.6 0.0 0.0 0.4 ABS / Securitization Warehouse Facilities Sale of Receivables 0.0 0.0 0.6 0.3 Accruals & Other Adjustments 0.4 19.1 Gross Debt 20.3 (8.6) Cash & Mktable Securities (10.0) (0.3) Derivatives (Assets)/Liabilities (0.3) 10.2 Net Debt 10.0 2.1 Undrawn committed credit lines 2.1 Note: Numbers may not add due to rounding January 29, 2014 Q4 & FY 2013 Results Review 45
  46. 46. Chrysler Gross debt (€bn) Outstanding Sept 30, ‘13 Outstanding Dec 31, ‘13 9.6 2.6 2.4 4.7 Cash Maturities Bank Debt Capital Market Other Debt 9.4 2.5 2.3 4.5 0.0 Asset-backed financing 0.0 0.0 ABS / Securitization 0.0 0.1 Accruals & Other Adjustments 0.2 9.8 Gross Debt 9.5 (8.5) Cash & Mktable Securities (9.7) (0.1) Derivatives (Assets)/Liabilities (0.1) 1.2 Net Debt (0.2) 1.0 Undrawn committed credit lines 0.9 Note: Numbers may not add due to rounding January 29, 2014 Q4 & FY 2013 Results Review 46
  47. 47. Debt maturity schedule (€bn) Outstanding Dec. 31, ‘13 6.2 11.9 1.2 Fiat ex Chrysler 2014 2015 2016 2017 2018 Beyond Bank Debt 2.5 1.7 0.9 0.4 0.4 0.4 Capital Market 2.3 2.0 2.3 2.2 1.9 1.3 Other Debt 0.8 0.0 0.0 0.0 0.0 0.3 5.6 3.7 3.2 2.7 2.2 1.9 19.3 Total Cash Maturities 10.0 Cash & Mktable Securities 2.1 12.1 Undrawn committed credit lines Total Available Liquidity 3.6 Sale of Receivables (IFRS de-recognition compliant) 2.2 of which receivables sold to financial services JVs (FGA Capital) Outstanding Dec. 31, ‘13 Chrysler 2014 2015 2016 2017 2018 Beyond 2.5 Bank Debt 0.0 0.0 0.0 2.1 0.1 0.2 2.3 Capital Market 0.0 0.0 0.0 0.0 0.0 2.3 4.5 Other Debt 0.3 0.3 0.4 0.4 0.4 2.7 0.4 0.4 0.4 2.5 0.5 5.3 9.4 9.7 0.9 10.6 Total Cash Maturities Cash & Mktable Securities Undrawn committed credit lines Total Available Liquidity Note: Numbers may not add due to rounding; total cash maturities excluding accruals January 29, 2014 Q4 & FY 2013 Results Review 47
  48. 48. Contacts GROUP INVESTOR RELATIONS TEAM Marco Auriemma  +39-011-006-3290 Maristella Borotto  +39-011-006-2709 Francesca Ferragina  +39-011-006-2308 Timothy Krause  +1-248-512-2923 Paolo Mosole Vice President  +39-011-006-1064 fax: +39-011-006-3796 email: websites: January 29, 2014 investor.relations@fiatspa.com www.fiatspa.com www.chryslergroupllc.com Q4 & FY 2013 Results Review 48

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