Stellantis: 2024 financial guidance confirmed, focus on value and global market challenges

Gloria Fiocchi Author
Stellantis confidently faces the challenges of 2024 and beyond, charting a solid course for value creation for all stakeholders.
Stellantis Investor Day

At the core of the strategy is financial sustainability. Stellantis reiterates its forecast of a double-digit adjusted operating income (AOI) margin and positive industrial free cash flow for 2024, demonstrating confidence in its ability to successfully navigate an ever-changing market.

Stellantis: solid course for the future in the changing automotive scene

Stellantis is not afraid of the challenges of 2024: during today’s Investor Day, CEO Carlos Tavares confirmed the solid course toward the future, outlining the nine strategic pillars that will guide the company in the evolving global automotive landscape. Main objective: create shareholder value.

Central to Stellantis’ strategy for 2024 is financial sustainability. The group company firmly reiterates its forecast of a double-digit adjusted operating income (AOI) margin and positive industrial free cash flow for the current year. This is a strong signal of confidence in Stellantis’ ability to successfully navigate an ever-changing market.

Stellantis is not forgetting its shareholders. Confirming its commitment to return value to those who have invested in the company, Stellantis announced a robust return on capital plan. This plan calls for the distribution of at least 7.7 billion euros in dividends and share buybacks in 2024. A concrete commitment that demonstrates Stellantis’ willingness to share its success with its shareholders.

Natalie Knight

CFO Natalie Knight offered a detailed overview of expectations for the first and second half of 2024. The first half of the year is expected to be characterized by an expected 10-11% operating margin and significantly lower industrial free cash flow than the previous year. In contrast, the second half of the year will be driven by major product launches, cost reduction initiatives, and an improvement in working capital. Factors that should contribute to a sequential improvement in operating margin and industrial free cash flow.

A part of its commitment to capital efficiency, Stellantis is introducing major changes in its capital management. Among them, the company is setting a cash target of 25-30% of revenues in the medium term. A way to optimize resource utilization and maximize shareholder return. In addition, Stellantis will continue to use share buybacks and ordinary dividends to return excess capital to shareholders. Specifically, in 2025 the group will aim for the high end of its dividend policy (25-30%), up from 25% in recent years. A signal of confidence in the future and a commitment to reward shareholders for their loyalty.

So, Stellantis looks to the future with optimism and confidence. The groupcompany’s sound business strategy, solid return plan for shareholders, and commitment to capital efficiency put the company in a strong position to meet the challenges and opportunities of the rapidly changing global automotive market.