Chrysler 1999 Annual Report Download - page 28

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Report on Operations – Analysis of the Financial Position and Operating Results of the Fiat Group and Fiat S.p.A.
Consolidated net income before minority interest totaled
506 million euros, compared with 916 million euros in 1998.
Fiat’s interest in net income amounted to 353 million euros,
as against 621 million euros in 1998.
Balance sheet
As required under Legislative Decree No. 127/91, a detailed
analysis of the Group’s balance sheet, which is presented in
accordance with the statutory format for consolidated financial
statements, is provided in the Notes to the Consolidated
Financial Statements.
In the table appearing on the following page, the Group’s
consolidated balance sheet has been reclassified and
presented in a condensed format, showing its main
components according to their destination and broken
down between Industrial and Insurance Activities.
Working capital
At December 31, 1999, the Group’s consolidated working
capital totaled 898 million euros, down from 1,870 million
euros in 1998, for a coverage index of 5 days for the Industrial
Activities (14 days in 1998).
An analysis of the changes affecting the main components
of working capital is provided below:
❚Inventories (raw materials, finished products and work in
progress), net of advances received, amounted to 7,987
million euros compared with 7,084 million euros in 1998.
Inventories were equivalent to 60 days of sales (56 days
in 1998).
❚Trade receivables totaled 6,665 million euros at the end of
1999, for an increase of 2.9% compared with 6,478 million
euros at December 31, 1998. At 50 days, the credit
exposure was about the same as in 1998.
❚Trade payables increased to 11,070 million euros, or 2,143
million euros more than the 8,927 million euros reported at
the end of 1998, while the debt exposure, measured on
sales revenues, increased to 83 days of sales (70 days in
the previous fiscal year). This was mainly due to increased
production activity and capital expenditures in the last
quarter of 1999.
Net property, plant and equipment
Net property, plant and equipment amounted to 15,920
million euros, up from 15,056 million euros at the end of 1998,
mainly as a result of changes in the scope of consolidation.
Net property, plant and equipment include fixed capital
earmarked for the Group’s medium and long-term automobile
and truck leasing operations, a new line of business with
considerable growth potential. Fixed capital in this category
posted a significant increase as compared to 1998.
A breakdown of the changes affecting this item is provided
in the Notes to the Consolidated Financial Statements.
Additions totaled 2,712 million euros (2,418 million euros
in 1998), while depreciation came to 2,074 million euros.
Retirements and other changes totaled 1,013 million euros
while positive changes in the scope of consolidation
amounted 1,239 million euros.
At December 31, 1999, accumulated depreciation and
writedowns totaled 18,920 million euros (18,489 million euros
in 1998). Property, plant and equipment was depreciated
at about 55% in 1999, almost unchanged from 1998.
Other fixed assets
Other fixed assets, which include financial fixed assets
(investments, securities and treasury stock) and intangibles
(start-up and expansion costs, goodwill, and intangible assets
in progress and others) amounted to 17,605 million euros
at December 31, 1999, or 8,258 million euros more than at
the end of 1998. Most of the increase is attributable to the
acquisition of Case Corporation by New Holland, which was
booked at cost, and the higher value of the securities held
by the insurance companies as coverage for their technical
reserves.
Working capital
(in millions of euros)
898
1,870
2,116
199919981997