Holden loses $70m in 2008

[R-Design]

Costs related to Family II engine plant closure see GM Holden lose $70m in 2008

http://www.goauto.com.au/mellor/mell...2575E10025AFA6

[vztrt]

Closure of the Family II engine plant is the main cause.

http://www.goauto.com.au/mellor/mell...2575E10025AFA6

Holden loses $70m in 2008

Costs related to Family II engine plant closure see GM Holden lose $70m in 2008

By MARTON PETTENDY 26 June 2009

GM HOLDEN this evening posted a $70.2 million operating loss for its financial year ending on December 31, 2008.

The better-than-expected result came in the same week that Toyota Australia announced a $123.4 million profit for its fiscal year ending on March 31, and following the record $274.4 million loss revealed by Ford Australia a week ago.

Holden stressed that it would have made a small after-tax profit of $6.6 million except for special, one-off charges that amounted to $76.8 million and related mainly to the upcoming closure of its Family II engine plant closure.

In addition, Holden said it made top-up contributions of $50.3 million to its Defined Benefits Scheme as the world financial markets began to deteriorate.

Reduced sales volumes saw total revenue drop from $6.1 billion in 2007 to $5.8 billion last year, which chairman and managing director Mark Reuss described as “disappointing, because the organisation was well placed to make a healthy profit in Australia before world markets fell in the third quarter of 2008”.

Total sales revenue was $5.4 billion compared to $5.7 billion in 2007, while vehicle and engine exports achieved increased revenue of $1.9 billion – up from $1.6 billion in 2007 on the back of a full year of Pontiac G8 sales in the US.

Mr Reuss said the fact Holden invested some $360 million in research and development in 2008 demonstrated that it remained committed to heavily investing in its longer-term future. He is on record as saying he expects Holden to return to profit in 2010.

“The Holden senior leadership team is doing everything possible to return to a profitable position as quickly as possible,” said Mr Reuss in a letter to employees today. “This includes attacking the revenue and cost sides of the business with equal enthusiasm.

“We have spoken about many of these strategies which include lowering operating costs on our vehicles, developing more alternative fuel and fuel-saving technologies, concentrating on production of our new fuel-efficient small car and pursuing export opportunities.

“At the same time, we must focus on our ongoing restructuring efforts to ensure we have the right business for the future. All of us have a role to play in improving our current position,” said Mr Reuss.

[gcg2503]

repost by one minute ;)

http://www.fordforums.com.au/showthread.php?t=11264689

[vztrt]

I know, already asked for a thread merge.

[R-Design]

GM-Holden chairman and managing director, Mark Reuss, expects the carmaker to return a profit "as quickly as possible"...

http://carsguide.news.com.au/site/ne..._in_australia/

[Windsor220]

Doesnt the financial year end 30th of June? Why are we getting all the manufacturers figures now?

[Paxton]

Originally Posted by Boss315

GM-Holden chairman and managing director, Mark Reuss, expects the carmaker to return a profit "as quickly as possible"...

http://carsguide.news.com.au/site/ne..._in_australia/

As quickly as possible. Meaning what?

Possible might mean 2015. There is no guarantee that Holden will ever enter profitability.

[Iggypoppin']

sounds strange, but I hope for the sake of SA's economy that Holden stays afloat. Nothing would be worse that several thousand employees getting the axe. Plus healthy competition is necessary in this day and age. Ford need to be faster than someone at Bathurst, clipsal etc

[Gobes32]

I am shocked to say the least, remember though, that their financial year finished over six months ago...... Interesting to see how they go this year with no export market to speak of?

[vztrt]

Age Article

http://business.theage.com.au/busine...0626-d00x.html

Holden hopes dashed in $70m loss
Andrew Heasley
June 27, 2009

IT WAS a case of close, but not close enough, for Holden yesterday, which announced it made a $70.2 million loss for 2008, after a small after-tax profit of $6.6 million was swamped by extraordinary items.

The small profit turned into a big loss after the company tallied up charges of $76.8 million that relate to the forthcoming closure of its Family II engine plant in Melbourne.

The company also incurred a hit of $50.3 million to top up employees' superannuation, which is a defined benefits scheme, as the financial crisis hit fund earnings.

In a communique to staff, Holden's chairman and managing director, Mark Reuss, said the result was "disappointing because the organisation was well placed to make a healthy profit in Australia before world markets fell in the third quarter of 2008".

Holden at least escaped the financial vortex that engulfed its parent, General Motors. GM entered chapter 11 bankruptcy protection in the United States this month with crippling debts after failing to reach agreement with creditors, including the US Government, which had loaned it more than $50 billion.

GM is trying to restructure its US and worldwide operations, including jettisoning underperforming brands such as Pontiac, Saab and Hummer. Holden announced this month it had escaped the axe.

Holden's loss is a further blow to the local car making industry, after Ford Australia announced a $274 million loss for 2008.

Toyota Australia was the only local maker to report a profit for last year, of $123.4 million after tax for the year to March 31.

Where Holden has been hit hard by GM's bankruptcy restructuring is in its export program — when locally made, left-hand-drive Commodores were exported to the US, rebadged as Pontiacs.

Exports grew from 35,000 cars in 2007 to 56,000 last year with the help of the Pontiac contract, boosting export revenue to $1.9 billion (up $300 million from 2007). That's now in tatters with the demise of the Pontiac brand. Holden spokesman Jonathan Rose would not be drawn on this year's likely export production numbers.

Last year Holden made 119,246 cars (including export models), up 11,451 on the previous year. All indications are 2009 production levels have been scaled back in line with declining demand for cars generally, and large cars especially.

"The Holden senior leadership team is doing everything possible to return to a profitable position as quickly as possible. This includes attacking the revenue and cost sides of the business with equal enthusiasm," Mr Ruess told staff.

[phillyc]

Interesting comparison between Ford and GMHolden then.

Both lost money on an after tax basis, with Ford much worse off. But the actual trading positions weren't all that different. This demonstrates that Ford is making good money on it's contract work, ie T6 and is running a pretty tight ship. GMH which made about twice the number of cars should've made much more, but clearly the export business is very volatile. Further to this, is if GMH were making good money up until the middle of the 3rd qtr, but then went all the way back to essentially a neutral position, wonder how bad the result for 2009/10 will be?

2008/9 Financial year ending March 2009
* Ford lost $14 million ($270 million after adjustments),
* GMH made $6 million (lost $70 million after adjustments).

* Ford invested $250.7 million on R&D,
* GMH invested $360 million on R&D

Anyway here is hoping for better times ahead for the local industry, in particular Ford with increased sales which are looking better/up these days.

[vztrt]

Car advice article

http://www.caradvice.com.au/33971/ho...-million-loss/

Holden has today announced a $70.2 million loss for the 2007-08 financial year.

The big loss comes after the company tallied up charges of $76.8 million that relate to the forthcoming closure of its Family II engine plant in Port Melbourne, VIC as well as a $50.3 million hit on employee’s superannuation as the financial crisis hit fund earnings.
Holden’s chairman and managing director, Mark Reuss, said in a message to staff that the result was “disappointing because the organisation was well placed to make a healthy profit in Australia before world markets fell in the third quarter of 2008″.

Holden’s loss is a further blow to the local car making industry, after Ford Australia announced a $274 million loss for the same period.

“The Holden senior leadership team is doing everything possible to return to a profitable position as quickly as possible,” said Mr Ruess. “This includes attacking the revenue and cost sides of the business with equal enthusiasm.”

Toyota Australia was the only local maker to report a profit for last year, of $123.4 million after tax for the year to March 31.

[R-Design]

Holden on until small car arrives

http://www.goauto.com.au/mellor/mell...2575E5001BF1D0

[The Snout]

Maybe Holden can put on a few more ads of kids hugging kangaroos in the back of Commodore's and see if that makes any difference.

Ruess comes across more as a salesman/excuse maker than a manager.